NZDCAD unable to break through key resistance level


New Zealand Dollar/Canadian Dollar (NZDCAD) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team

Highlights

NZDCAD closes below its opening price unable to hold early session gains
NZDCAD unable to break through key resistance level
NZDCAD closes lower for the 2nd day in a row
NZDCAD closes within previous day's range after lackluster session

Overview

Moving lower for the 2nd day in a row, NZDCAD finished the week 1.99% higher at 0.8539 after losing 3 pips (-0.04%) today. Trading 36 pips higher after the open, the market 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 (NZDCAD as at May 22, 2020):

Daily technical analysis candlestick chart for New Zealand Dollar/Canadian Dollar (NZDCAD) as at May 22, 2020

Friday's trading range has been 57 pips (0.67%), that's below the last trading month's daily average range of 76 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NZDCAD.

Two candlestick patterns are matching today's price action, the Northern Doji which is known as bearish pattern and one neutral pattern, the Doji.

Unable to break through the key technical resistance level at 0.8556 (R1), the currency closed below it after spiking up to 0.8576 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. When prices bounced off a significant resistance level the last time on May 8th, NZDCAD lost -0.39% on the following trading day.

The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.

Further buying might move prices higher should the market test April's close-by high at 0.8577.

Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for NZD/CAD. Out of 597 times, NZDCAD closed lower 53.10% 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 52.26% with an average market move of -0.05%.

With four out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.47% and EURUSD closing -0.44% lower. On the flipside the best performers have been USDCAD closing 0.33% higher and USDCHF gaining 0.08%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDCZK surging 1.09% and USDHUF closing 0.9% higher. The worst performers of the day have been USDMXN tanking -0.58% and SGDHKD closing -0.51% lower. Read more


Market Conditions for NZDCAD as at May 22, 2020

Loading Market Conditions for NZDCAD (New Zealand Dollar/Canadian Dollar)...
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NZDCAD stuck within tight trading range

May 25, 2020
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