USDAUD pushes through Thursday's high
US Dollar/Australian Dollar (USDAUD) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDAUD ended the week -1.88% lower at 1.5298 after gaining 66 pips (0.43%) today. Closing above Thursday's high at 1.5270, the market confirmed its breakout through the previous session high after trading up to 100 pips above it intraday.
Daily Candlestick Chart (USDAUD as at May 22, 2020):
Friday's trading range has been 154 pips (1.01%), that's below the last trading month's daily average range of 192 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for USDAUD.
One bearish candlestick pattern matches today's price action, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on May 14th, USDAUD actually gained 0.75% on the following trading day.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Selling might speed up should prices move below the nearby swing low at 1.5115 where further sell stops could get triggered. Trading close to March's low at 1.4959 we might see further downside momentum if potential sell stops at the level get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Hikkake Pattern" stand out. Its common bearish interpretation has been confirmed for USD/AUD. Out of 115 times, USDAUD closed lower 60.00% 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 nine trading days, showing a win rate of 57.39% with an average market move of -0.02%.