USDJPY plunges, losing 52 pips (-0.47%) within a single day
US Dollar/Japanese Yen (USDJPY) Technical Analysis Report for Dec 02, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, USDJPY ended Monday at 108.98 tanking 52 pips (-0.47%). This is the biggest single-day loss in over a month. The bears were in full control today, moving the market lower throughout the whole session. Closing below Friday's low at 109.40, the forex pair confirmed its breakout through the previous session low after trading up to 47 pips below it intraday.
Daily Candlestick Chart (USDJPY as at Dec 02, 2019):
Monday's trading range has been 80 pips (0.73%), that's far above the last trading month's daily average range of 46 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for USDJPY.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. The last time this happened on October 30th, USDJPY lost -0.74% on the following trading day. In spite of a strong opening the currency closed below the prior day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
After trading as low as 108.93 during the day, the FX pair found support at the 20-day moving average at 108.97. Prices broke below the key technical support level at 109.49 (now R1), which is likely to act as resistance going forward. After having been unable to move above 109.67 in the previous session, the Yen ran into sellers again around the same price level today, failing to move higher than 109.73.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the 14 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Very Strong Down Move" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for USD/JPY. Out of 107 times, USDJPY closed higher 54.21% 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 55.14% with an average market move of 0.28%.
With five out of the other six Major FX Pairs closing higher today, the ones that stand out on the positive side are NZDUSD gaining 1.25% and AUDUSD closing 0.84% higher. On the flipside the worst performer has been USDCHF closing -0.88% lower. Looking at the Minor FX Pairs and Crosses, the winners of the day have been NZDCAD surging 1.45% and NZDHKD closing 1.24% higher. The worst performers of the day have been USDHUF tanking -1.33% and USDPLN closing -1.19% lower. Read more