NZDAUD crashes, losing 34 pips (-0.36%) within a single day
New Zealand Dollar/Australian Dollar (NZDAUD) Technical Analysis Report for Jul 13, 2020 | by Techniquant Editorial Team
NZDAUD finished Monday at 0.9424 tanking 34 pips (-0.36%). This is the biggest single-day loss in over two weeks. Closing below Friday's low at 0.9430, the market confirmed its breakout through the previous session low after trading up to 17 pips below it intraday.
Daily Candlestick Chart (NZDAUD as at Jul 13, 2020):
Monday's trading range has been 51 pips (0.54%), that's above the last trading month's daily average range of 45 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 lower than usual for NZDAUD.
Two candlestick patterns are matching today's price action, the Tweezer Top which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Tweezer Top showed up on July 6th, NZDAUD gained 0.27% on the following trading day.
Prices are trading close to the key technical support level at 0.9410 (S1). After having been unable to move above 0.9464 in the prior session, the currency ran into sellers again around the same price level today, missing to move higher than 0.9464.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and might now be heading back down towards the mean of the Bollinger Bands at 0.9386.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling could speed up should prices move below the nearby swing low at 0.9408 where further sell stops might get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Strong Down Move" stand out. Its common bearish interpretation has been confirmed for NZD/AUD. Out of 194 times, NZDAUD closed lower 52.58% 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 three trading days, showing a win rate of 54.12% with an average market move of -0.02%.