SGDCHF breaks below Thursday's low
Singapore Dollar/Swiss Franc (SGDCHF) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
SGDCHF finished the week 0.15% higher at 0.6816 after losing 30 pips (-0.44%) today on low volume. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 0.6820, the pair confirmed its breakout through the previous session low after trading up to 9 pips below it intraday.
Daily Candlestick Chart (SGDCHF as at May 22, 2020):
Friday's trading range has been 44 pips (0.64%), that's slightly below the last trading month's daily average range of 46 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 SGDCHF.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. The last time this happened on May 14th, SGDCHF lost -0.44% on the following trading day. Regardless of a strong opening the forex pair closed below the prior day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
Unable to break through the key technical resistance level at 0.6850 (R1), the FX pair closed below it after spiking up to 0.6855 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 0.6853 in the previous session, SGD/CHF ran into sellers again around the same price level today, missing to move higher than 0.6855.
The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling could accelerate should prices move below the nearby swing low at 0.6800 where further sell stops might get activated. As prices are trading close to May's low at 0.6775, downside momentum could speed up should the currency mark new lows for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Down Move" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for SGD/CHF. Out of 241 times, SGDCHF closed higher 54.77% 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 55.19% with an average market move of 0.22%.
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