JPYHKD pushes through Wednesday's high
Japanese Yen/Hong Kong Dollar (JPYHKD) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
JPYHKD finished Thursday at 0.07072 gaining 103 pips (1.48%) on low volume. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Wednesday's high at 0.07003, JPY/HKD confirmed its breakout through the previous session high after trading up to 94 pips above it intraday.
Daily Candlestick Chart (JPYHKD as at Mar 26, 2020):
Thursday's trading range has been 133 pips (1.91%), that's slightly below the last trading month's daily average range of 147 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for JPYHKD. Prices continued to consolidate within a tight trading range between 0.06940 and 0.07097 where it has been caught now for the whole last trading week.
Regardless of a weak opening the forex pair managed to close above the prior day's open and close, forming a bullish Engulfing Candle. Additionally, two candlestick patterns are matching today's price action, the White Candle which is known as bullish pattern and one bearish pattern, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on February 27th, JPYHKD actually gained 1.38% on the following trading day.
Unable to break through the key technical resistance level at 0.07087 (R1), the currency closed below it after spiking up to 0.07097 earlier during the day. The failure to close above the resistance might increase that levels importance going forward.
The FX pair shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
With prices trading close to this year's low at 0.06935, downside momentum could speed up should the market break out to new lows for the year.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Hikkake Pattern" stand out. Its common bearish interpretation has been confirmed for JPY/HKD. Out of 113 times, JPYHKD closed lower 54.87% 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 five trading days, showing a win rate of 55.75% with an average market move of -0.07%.