USDHUF unable to break through key resistance level
US Dollar/Hungarian Forint (USDHUF) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDHUF finished Wednesday at 304.0105 gaining 19025 pips (0.63%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Tuesday's high at 302.2045, the forex pair confirmed its breakout through the previous session high after trading up to 23595 pips above it intraday.
Daily Candlestick Chart (USDHUF as at Sep 16, 2020):
Wednesday's trading range has been 30100 pips (1.0%), that's slightly below the last trading month's daily average range of 35220 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 USDHUF.
One bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on September 2nd, USDHUF gained 0.24% on the following trading day.
Unable to break through the key technical resistance level at 304.3405 (R1), the FX pair closed below it after spiking up to 304.5640 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
Though the pair is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Selling could accelerate should prices move below the nearby swing low at 299.9890 where further sell stops might get activated. With prices trading close to this year's low at 289.1155, downside momentum could speed up should the market break out to new lows for the year. Trading close to July's high at 317.2005 we might see further upside momentum if potential buy stops at the level get triggered. As prices are trading close to September's low at 295.0240, downside momentum could accelerate should USD/HUF mark new lows for the month.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) above 80" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for USD/HUF. Out of 274 times, USDHUF closed higher 59.12% 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 51.82% with an average market move of 0.19%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.61% and NZDUSD closing 0.27% higher. On the flipside the worst performers have been USDJPY closing -0.47% lower and EURUSD losing -0.25%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPPLN surging 0.81% and ZARJPY closing 0.78% higher. The worst performers of the day have been EURZAR tanking -1.42% and CHFZAR closing -1.28% lower. Read more