JPYNZD closes below its opening price unable to hold early session gains
Japanese Yen/New Zealand Dollar (JPYNZD) Technical Analysis Report for Oct 16, 2020 | by Techniquant Editorial Team
JPYNZD finished the week 1.17% higher at 0.014360 after losing 14 pips (-0.1%) today. Trading 56 pips higher after the open, JPY/NZD was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (JPYNZD as at Oct 16, 2020):
Friday's trading range has been 89 pips (0.62%), that's below the last trading month's daily average range of 129 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 JPYNZD.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Shooting Star which are both known as bearish patterns.
After trading down to 0.014339 earlier during the day, the market bounced off the key technical support level at 0.014347 (S1). The failure to close below the support might increase that levels importance as support going forward. When prices bounced off a significant support level the last time on Wednesday, JPYNZD gained 0.63% on the following trading day. Prices are trading close to the key technical resistance level at 0.014447 (R1).
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could accelerate should prices move above the close-by swing high at 0.014447 where further buy stops might get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Its common bearish interpretation has been confirmed for JPY/NZD. Out of 252 times, JPYNZD closed lower 55.56% 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 57.94% with an average market move of -0.22%.