SGDGBP plummets, losing 48 pips (-0.82%) within a single day on low volume
Singapore Dollar/British Pound (SGDGBP) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
SGDGBP ended the month 0.94% higher at 0.5786 after tanking 48 pips (-0.82%) today on low volume. This is the biggest single-day loss in over two months. The bears were in full control today, moving the market lower throughout the whole session. Closing below Monday's low at 0.5796, the market confirmed its breakout through the prior session low after trading up to 10 pips below it intraday.
Daily Candlestick Chart (SGDGBP as at Jun 30, 2020):
Tuesday's trading range has been 57 pips (0.98%), that's far above the last trading month's daily average range of 44 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 SGDGBP.
Despite a strong opening the pair closed below the previous day's open and close, forming a bearish Engulfing Candle. The last time this candlestick pattern showed up on May 14th, SGDGBP actually gained 0.77% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Bearish Closing Marubozu and the Black Candle which are both known as bearish patterns.
Prices broke below the key technical support level at 0.5797 (now R1), which is likely to act as resistance going forward.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for SGD/GBP. Out of 481 times, SGDGBP closed higher 57.38% 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 54.26% with an average market move of 0.26%.