TRYUSD still stuck within tight trading range
Turkish Lira/US Dollar (TRYUSD) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
TRYUSD ended the month -0.41% lower at 0.1459 after flat today. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (TRYUSD as at Jun 30, 2020):
Tuesday's trading range has been 4 pips (0.27%), that's far below the last trading month's daily average range of 12 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for TRYUSD. Prices continued to consolidate within a tight trading range between 0.1454 and 0.1465 where it has been caught now for the whole last trading week.
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. Notwithstanding a weak opening the pair managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, three candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern and the Southern Doji which are both known as bullish patterns and one neutral pattern, the Doji. The last time a Last Engulfing Bottom Pattern showed up on June 26th, TRYUSD gained 0.07% on the following trading day.
Prices are trading close to the key technical support level at 0.1454 (S1).
The currency shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying might speed up should prices move above the close-by swing high at 0.1464 where further buy stops could get activated. Selling might accelerate should prices move below the nearby swing low at 0.1454 where further sell stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for TRY/USD. Out of 148 times, TRYUSD closed lower 52.70% 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 57.43% with an average market move of -0.65%.