USDTRY runs into sellers around 5.9480 for the forth day in a row
US Dollar/Turkish Lira (USDTRY) Technical Analysis Report for Jan 24, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDTRY finished the week 0.87% higher at 5.9390 after gaining 38 pips (0.06%) today. Trading up to 113 pips lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (USDTRY as at Jan 24, 2020):
Friday's trading range has been 239 pips (0.4%), that's below the last trading month's daily average range of 361 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for USDTRY. Prices continued to consolidate within a tight trading range between 5.8899 and 5.9480 where it has been caught now for the whole last trading week.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Unable to break through the key technical resistance level at 5.9395 (R1), the FX pair closed below it after spiking up to 5.9480 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. USD/TRY was sold again around 5.9480 after having seen highs at 5.9469, 5.9451 and 5.9420 in the last three trading sessions. Obviously there is something going on at that level. The last time this happened on December 12, 2019, USDTRY actually gained 0.31% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling might accelerate should prices move below the nearby swing low at 5.9055 where further sell stops could get activated. With prices trading close to this year's high at 5.9892, upside momentum might speed up should the pair be able to break out to new highs for the year.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior two Highs" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for USD/TRY. Out of 172 times, USDTRY closed higher 55.23% 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 62.21% with an average market move of 0.88%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.41% and AUDUSD closing -0.34% lower. On the flipside the best performers have been USDCHF closing 0.23% higher and USDCAD gaining 0.14%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDNOK surging 0.57% and USDPLN closing 0.53% higher. The worst performers of the day have been GBPJPY tanking -0.6% and AUDJPY closing -0.53% lower. Read more