NZDJPY breaks below Thursday's low
New Zealand Dollar/Japanese Yen (NZDJPY) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, NZDJPY ended the week 3.32% higher at 65.64 after losing 23 pips (-0.35%) today. Closing below Thursday's low at 65.72, the forex pair confirmed its breakout through the prior session low after trading up to 33 pips below it intraday.
Daily Candlestick Chart (NZDJPY as at May 22, 2020):
Friday's trading range has been 58 pips (0.88%), that's below the last trading month's daily average range of 90 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 higher than usual for NZDJPY.
Prices are trading close to the key technical support level at 65.02 (S1).
While NZD/JPY is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could accelerate should prices move above the close-by swing high at 66.25 where further buy stops might get activated.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for NZD/JPY. Out of 312 times, NZDJPY closed higher 50.64% 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 four trading days, showing a win rate of 53.21% with an average market move of 0.06%.
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