JPYHKD closes within previous day's range after lackluster session
Japanese Yen/Hong Kong Dollar (JPYHKD) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
JPYHKD finished the week -0.5% lower at 0.07205 after flat today. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (JPYHKD as at May 22, 2020):
Friday's trading range has been 31 pips (0.43%), that's below the last trading month's daily average range of 44 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for JPYHKD. Prices continued to consolidate within a tight trading range between 0.07179 and 0.07225 where it has been caught now for the last three trading days.
Despite a weak opening the currency managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, five candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern and the Southern Doji which are both known as bullish patterns, two bearish patterns, the Bearish Hikkake Pattern and the Gravestone Doji and one neutral pattern, the Doji. The last time a Gravestone Doji showed up on March 20th, JPYHKD lost -0.41% on the following trading day.
While the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could accelerate should prices move below the close-by swing low at 0.07168 where further sell stops might get activated.
Among the seven 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 117 times, JPYHKD closed lower 52.99% 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 53.85% with an average market move of -0.02%.