JPYZAR unable to break through key resistance level
Japanese Yen/South African Rand (JPYZAR) Technical Analysis Report for May 29, 2020 | by Techniquant Editorial Team
JPYZAR finished the month -6.01% lower at 0.1626 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 (JPYZAR as at May 29, 2020):
Friday's trading range has been 22 pips (1.35%), that's far below the last trading month's daily average range of 35 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for JPYZAR.
Three candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern, one bearish pattern, the Gravestone Doji and one neutral pattern, the Doji. The last time a Southern Doji showed up on Monday, JPYZAR actually lost -1.16% on the following trading day.
Unable to break through the key technical resistance level at 0.1634 (R1), the forex pair closed below it after spiking up to 0.1645 earlier during the day. The failure to close above the resistance might increase that levels importance going forward.
While the FX pair is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might accelerate should prices move below the close-by swing low at 0.1603 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Southern Doji" stand out. Its common bullish interpretation has been confirmed for JPY/ZAR. Out of 50 times, JPYZAR closed higher 54.00% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 56.00% with an average market move of 0.39%.