USDPLN unable to break through key resistance level
US Dollar/Polish Zloty (USDPLN) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
USDPLN finished the week -1.98% lower at 4.1397 after gaining 193 pips (0.47%) today. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (USDPLN as at May 22, 2020):
Friday's trading range has been 335 pips (0.81%), that's below the last trading month's daily average range of 407 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for USDPLN.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a Bullish Short Candle showed up on April 16th, USDPLN actually lost -0.83% on the following trading day.
Unable to break through the key technical resistance level at 4.1432 (R1), the pair closed below it after spiking up to 4.1528 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and might now be heading back up towards the mean of the Bollinger Bands at 4.1848.
Though the currency is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might accelerate should prices move below the close-by swing low at 4.1083 where further sell stops could get triggered. Further selling might move prices lower should the market test April's nearby low at 4.1040.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for USD/PLN. Out of 629 times, USDPLN closed lower 51.51% of the time on the next trading day after the market condition occurred.
With four out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.47% and EURUSD closing -0.44% lower. On the flipside the best performers have been USDCAD closing 0.33% higher and USDCHF gaining 0.08%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDCZK surging 1.09% and USDHUF closing 0.9% higher. The worst performers of the day have been USDMXN tanking -0.58% and SGDHKD closing -0.51% lower. Read more