TRYJPY finds support at 20-day moving average
Turkish Lira/Japanese Yen (TRYJPY) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
TRYJPY finished Thursday at 17.13 losing 20 pips (-1.15%). Closing below Wednesday's low at 17.16, the currency confirmed its breakout through the prior session low after trading up to 20 pips below it intraday.
Daily Candlestick Chart (TRYJPY as at Mar 26, 2020):
Thursday's trading range has been 39 pips (2.25%), that's slightly below the last trading month's daily average range of 43 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 TRYJPY.
Notwithstanding a strong opening TRY/JPY closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
After trading as low as 16.96 during the day, the market found support at the 20-day moving average at 17.07. Prices broke below the key technical support level at 17.25 (now R1), which is likely to act as resistance going forward. The last time this happened on March 16th, TRYJPY actually gained 2.25% on the following trading day.
Though the FX pair is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might accelerate should prices move above the nearby swing high at 17.46 where further buy stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Bounce off SMA 20" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for TRY/JPY. Out of 171 times, TRYJPY closed lower 50.29% 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 60.23% with an average market move of -0.45%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 2.72% and NZDUSD closing 1.88% higher. On the flipside the worst performers have been USDCHF closing -1.43% lower and USDJPY losing -1.42%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPHKD surging 2.72% and GBPZAR closing 2.65% higher. The worst performers of the day have been USDMXN tanking -4.12% and USDNOK closing -3.12% lower. Read more