TRYUSD bounces off lows recouping most intraday losses
Turkish Lira/US Dollar (TRYUSD) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, TRYUSD finished Thursday at 0.1563 gaining 5 pips (0.32%). Trading up to 21 pips lower after the open, the currency managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (TRYUSD as at Mar 26, 2020):
Thursday's trading range has been 31 pips (1.99%), that's slightly above the last trading month's daily average range of 28 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for TRYUSD.
Although trading as low as 0.1537 during the day, the pair has decisively rejected those price levels and formed a bullish Pin Bar closing 26 pips above today's low. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man.
After trading down to 0.1537 earlier during the day, the forex pair bounced off the key technical support level at 0.1548 (S1). The failure to close below the support could increase that levels significance as support going forward. The FX pair ran into sellers again today around 0.1568 for the third trading day in a row after having found sellers at 0.1567 in the prior session and at 0.1565 two days ago. The last time this happened on March 6th, TRYUSD lost -0.79% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Pin Bar" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for TRY/USD. Out of 7 times, TRYUSD closed lower 57.14% 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 71.43% with an average market move of -1.78%.