NZDGBP unable to break through key resistance level
New Zealand Dollar/British Pound (NZDGBP) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
NZDGBP ended the month 3.6% higher at 0.5205 after losing 16 pips (-0.31%) today on low volume. 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 (NZDGBP as at Jun 30, 2020):
Tuesday's trading range has been 27 pips (0.52%), that's far below the last trading month's daily average range of 44 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for NZDGBP.
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, two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns.
Unable to break through the key technical resistance level at 0.5225 (R1), the FX pair closed below it after spiking up to 0.5227 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. When prices bounced off a significant resistance level the last time on May 6th, NZDGBP actually gained 1.11% on the following trading day. After having been unable to move above 0.5229 in the prior session, the forex pair ran into sellers again around the same price level today, failing to move higher than 0.5227.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 0.5229 where further buy stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Short Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for NZD/GBP. Out of 62 times, NZDGBP closed higher 59.68% 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 46.77% with an average market move of 0.04%.