JPYZAR unable to break through key resistance level
Japanese Yen/South African Rand (JPYZAR) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
JPYZAR ended the week -1.09% lower at 0.1359 after edging lower 3 pips (-0.22%) today. Trading 10 pips higher after the open, the pair 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 missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (JPYZAR as at Feb 14, 2020):
Friday's trading range has been 24 pips (1.76%), that's slightly above the last trading month's daily average range of 21 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for JPYZAR.
Two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Bearish High-Wave Candle which are both known as bearish patterns.
After trading down to 0.1348 earlier during the day, the currency bounced off the key technical support level at 0.1351 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on February 3rd, JPYZAR actually lost -1.46% on the following trading day. Unable to break through the key technical resistance level at 0.1368 (R1), the market closed below it after spiking up to 0.1372 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. After having been unable to move lower than 0.1348 in the prior session, JPY/ZAR found buyers again around the same price level today at 0.1348.
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.
Selling could accelerate should prices move below the close-by swing low at 0.1339 where further sell stops might get activated. With prices trading close to this year's high at 0.1389, upside momentum could speed up should the forex pair be able to break out to new highs for the year.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish High-Wave Candle" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for JPY/ZAR. Out of 39 times, JPYZAR closed higher 58.97% of the time on the next trading day after the market condition occurred.