PLNGBP runs into sellers again around 0.2025
Polish Zloty/British Pound (PLNGBP) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
PLNGBP ended Thursday at 0.1997 losing 6 pips (-0.3%). Trading 22 pips higher after the open, PLN/GBP was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Monday, PLNGBP lost -1.24% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (PLNGBP as at Mar 26, 2020):
Thursday's trading range has been 35 pips (1.75%), that's slightly below the last trading month's daily average range of 43 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for PLNGBP. Prices continued to consolidate within a tight trading range between 0.1975 and 0.2034 where it has been caught now for the last three trading days.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Prices are trading close to the key technical support level at 0.1983 (S1). Unable to break through the key technical resistance level at 0.2009 (R1), the currency closed below it after spiking up to 0.2025 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. After having been unable to move above 0.2026 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 0.2025.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 0.1975 where further sell stops might get triggered. With prices trading close to this year's low at 0.1938, downside momentum could accelerate should the forex pair break out to new lows for the year.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for PLN/GBP. Out of 620 times, PLNGBP closed lower 53.06% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 52.42% with an average market move of -0.09%.