USDDKK pushes through key technical resistance level
US Dollar/Danish Krone (USDDKK) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
USDDKK ended the month -4.69% lower at 6.3230 after gaining 393 pips (0.63%) today on high volume. Trading up to 327 pips lower after the open, the pair managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (USDDKK as at Jul 31, 2020):
Friday's trading range has been 820 pips (1.31%), that's far above the last trading month's daily average range of 523 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for USDDKK.
In spite of a weak opening the forex pair managed to close above the previous day's open and close, forming a bullish Engulfing Candle. The last time this candlestick pattern showed up on April 13th, USDDKK actually lost -0.63% on the following trading day.
Buyers managed to take out the key technical resistance level at 6.3177 (now S1), which is likely to act as support going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
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. Its common bullish interpretation has been confirmed for USD/DKK. Out of 100 times, USDDKK closed higher 51.00% 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 60.00% with an average market move of 0.32%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are NZDUSD losing -1.04% and AUDUSD closing -0.72% lower. On the flipside the best performers have been USDJPY closing 1.12% higher and USDCHF gaining 0.48%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDZAR surging 1.87% and GBPZAR closing 1.79% higher. The worst performers of the day have been NZDCAD tanking -1.15% and NZDHKD closing -1.05% lower. Read more