JPYZAR falls to lowest close since July 22nd
Japanese Yen/South African Rand (JPYZAR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, JPYZAR ended Wednesday at 0.1548 losing 12 pips (-0.77%). Today's close at 0.1548 marks the lowest recorded closing price since July 22nd. The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 0.1555, the pair confirmed its breakout through the prior session low after trading up to 9 pips below it intraday.
Daily Candlestick Chart (JPYZAR as at Sep 16, 2020):
Wednesday's trading range has been 19 pips (1.22%), that's far below the last trading month's daily average range of 28 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 JPYZAR.
Two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns.
After trading down to 0.1546 earlier during the day, the FX pair bounced off the key technical support level at 0.1546 (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 Monday, JPYZAR actually lost -0.95% on the following trading day. Prices are trading close to the key technical resistance level at 0.1567 (R1).
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Trading close to July's low at 0.1527 we could see further downside momentum if potential sell stops at the level get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "4 Consecutive Lower Closes" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for JPY/ZAR. Out of 73 times, JPYZAR closed higher 57.53% 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 50.68% with an average market move of 0.22%.