NZDEUR closes above its opening price after recovering from early selling pressure
New Zealand Dollar/Euro (NZDEUR) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
NZDEUR ended the week 1.97% higher at 0.5593 after edging higher 3 pips (0.05%) today. Trading up to 15 pips lower after the open, NZD/EUR managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (NZDEUR as at May 22, 2020):
Friday's trading range has been 32 pips (0.57%), that's far below the last trading month's daily average range of 61 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 NZDEUR. Prices continued to consolidate within a tight trading range between 0.5552 and 0.5607 where it has been caught now for the last three trading days.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top. The last time a Bullish Spinning Top showed up on April 22nd, NZDEUR gained 1.33% on the following trading day.
Unable to break through the key technical resistance level at 0.5594 (R1), the market closed below it after spiking up to 0.5607 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. The forex pair ran into sellers again today around 0.5607 for the third trading day in a row after having found sellers at 0.5602 in the previous session and at 0.5602 two days ago.
The currency shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
As prices are trading close to May's high at 0.5680, upside momentum might speed up should the pair mark new highs for the month.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bullish Intraday Reversal" stand out. Its common bullish interpretation has been confirmed for NZD/EUR. Out of 437 times, NZDEUR closed higher 52.86% of the time on the next trading day after the market condition occurred.