USDAUD breaks below key technical support level
US Dollar/Australian Dollar (USDAUD) Technical Analysis Report for Jul 29, 2020 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, USDAUD ended Wednesday at 1.3912 losing 58 pips (-0.42%). Today's close at 1.3912 marks the lowest recorded closing price since February 5, 2019. Closing below Tuesday's low at 1.3933, the forex pair confirmed its breakout through the prior session low after trading up to 38 pips below it intraday.
Daily Candlestick Chart (USDAUD as at Jul 29, 2020):
Wednesday's trading range has been 95 pips (0.68%), that's below the last trading month's daily average range of 122 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for USDAUD.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 1.3922 (now R1), which is likely to act as resistance going forward. The last time this happened on July 8th, USDAUD actually gained 0.24% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
2019's low at 1.3708 is within reach and we might see further downside momentum should USD/AUD break out beyond.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "52 Week Low" stand out. Its common bearish interpretation has been confirmed for USD/AUD. Out of 51 times, USDAUD closed lower 54.90% 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 54.90% with an average market move of -0.07%.