NZDEUR finds buyers at key support level
New Zealand Dollar/Euro (NZDEUR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, NZDEUR finished Wednesday at 0.5697 gaining 31 pips (0.55%). Closing above Tuesday's high at 0.5676, the currency confirmed its breakout through the previous session high after trading up to 36 pips above it intraday.
Daily Candlestick Chart (NZDEUR as at Sep 16, 2020):
Wednesday's trading range has been 49 pips (0.86%), that's slightly above the last trading month's daily average range of 45 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for NZDEUR.
One bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on Monday, NZDEUR gained 0.32% on the following trading day.
After trading down to 0.5663 earlier during the day, the market bounced off the key technical support level at 0.5667 (S1). The failure to close below the support could increase that levels importance as support going forward. After spiking up to 0.5712 during the day, NZD/EUR found resistance at the 200-day moving average at 0.5699.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Buying might speed up should prices move above the nearby swing high at 0.5724 where further buy stops could get activated. As prices are trading close to September's high at 0.5724, upside momentum might accelerate should the FX pair mark new highs for the month.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for NZD/EUR. Out of 509 times, NZDEUR closed higher 56.58% 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 53.44% with an average market move of 0.12%.