NZDEUR unable to break through key resistance level
New Zealand Dollar/Euro (NZDEUR) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
NZDEUR finished the week 1.56% higher at 0.5940 after gaining 1 pip (0.02%) today on low volume. Trading up to 13 pips lower after the open, the forex pair managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Monday, NZDEUR gained 0.24% on the following trading day. 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 (NZDEUR as at Feb 14, 2020):
Friday's trading range has been 19 pips (0.32%), that's far below the last trading month's daily average range of 38 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for NZDEUR.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Unable to break through the key technical resistance level at 0.5944 (R1), the currency closed below it after spiking up to 0.5945 earlier during the day. The failure to close above the resistance might increase that levels significance going forward.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 0.5957 where further buy stops might get activated. With prices trading close to this year's high at 0.6008, upside momentum could speed up should the pair be able to break out to new highs for the year.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for NZD/EUR. Out of 769 times, NZDEUR closed higher 54.49% 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 53.97% with an average market move of 0.14%.