JPYCAD breaks above 200-day moving average for the first time since August 10th
Japanese Yen/Canadian Dollar (JPYCAD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, JPYCAD finished Wednesday at 0.012557 gaining 52 pips (0.42%). Today's close at 0.012557 marks the highest recorded closing price since August 10th. Closing above Tuesday's high at 0.012516, the forex pair confirmed its breakout through the prior session high after trading up to 61 pips above it intraday.
Daily Candlestick Chart (JPYCAD as at Sep 16, 2020):
Wednesday's trading range has been 79 pips (0.63%), that's below the last trading month's daily average range of 102 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for JPYCAD.
One bullish candlestick pattern matches today's price action, the White Candle.
The currency managed to close above the 200-day moving average at 0.012548 for the first time since August 10th. Prices are trading close to the key technical resistance level at 0.012612 (R1).
Crossing above the upper Bollinger Band for the first time since July 30th, prices have shown unusually strong upward momentum in the short-term. This could either indicate a potential buying climax after which prices might head back down towards the mean of the Bollinger Bands at 0.012403 or signal the beginning of a strong momentum breakout leading to even higher prices. The last time prices broke out above the upper Bollinger Band on July 30th, JPYCAD actually lost -1.15% on the following trading day.
Though the pair is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Further buying might move prices higher should the market test August's nearby high at 0.012708.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Break through SMA 50" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for JPY/CAD. Out of 106 times, JPYCAD closed lower 50.94% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 57.55% with an average market move of -0.10%.