USDAUD breaks below key technical support level
US Dollar/Australian Dollar (USDAUD) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving lower for the 5th day in a row, USDAUD ended Thursday at 1.6493 losing 288 pips (-1.72%). Trading 252 pips higher after the open, the pair was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Monday, USDAUD lost -2.00% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (USDAUD as at Mar 26, 2020):
Thursday's trading range has been 607 pips (3.62%), that's slightly above the last trading month's daily average range of 513 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for USDAUD.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar.
Prices broke below the key technical support level at 1.6706 (now R1), which is likely to act as resistance going forward. After having been unable to move lower than 1.6464 in the previous session, the currency found buyers again around the same price level today at 1.6426.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Support S1" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for USD/AUD. Out of 376 times, USDAUD closed higher 53.99% 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 53.72% with an average market move of 0.32%.