USDJPY closes below its opening price unable to hold early session gains
US Dollar/Japanese Yen (USDJPY) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, USDJPY ended the week 0.03% higher at 109.78 after losing 5 pips (-0.05%) today. Trading 9 pips higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (USDJPY as at Feb 14, 2020):
Friday's trading range has been 21 pips (0.19%), that's far below the last trading month's daily average range of 44 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for USDJPY. Prices continued to consolidate within a tight trading range between 109.56 and 110.16 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on January 30th, USDJPY lost -0.55% on the following trading day.
Prices are trading close to the key technical support level at 109.54 (S1).
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could speed up should prices move above the close-by swing high at 110.16 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 109.62 where further sell stops might get triggered. With prices trading close to this year's high at 110.29, upside momentum could speed up should the pair be able to break out to new highs for the year.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bearish Intraday Reversal" stand out. Its common bearish interpretation has been confirmed for USD/JPY. Out of 378 times, USDJPY closed lower 50.53% 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 52.38% with an average market move of -0.06%.
With four out of the other six Major FX Pairs closing lower today, the ones that stand out on the negative side are USDCAD losing -0.12% and EURUSD closing -0.08% lower. On the flipside the best performers have been USDCHF closing 0.28% higher and GBPUSD gaining 0.02%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been USDSEK surging 0.51% and EURSEK closing 0.43% higher. The worst performers of the day have been EURHUF tanking -0.65% and USDHUF closing -0.58% lower. Read more