USDZAR closes below its opening price unable to hold early session gains
US Dollar/South African Rand (USDZAR) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, USDZAR ended Thursday at 17.3244 edging lower 123 pips (-0.07%). Trading 2731 pips higher after the open, the forex pair was unable to hold its gains as the bears took control ending the day below 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 (USDZAR as at Mar 26, 2020):
Thursday's trading range has been 3727 pips (2.15%), that's below the last trading month's daily average range of 4651 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for USDZAR.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Gravestone Doji which is known as bearish pattern and one neutral pattern, the Doji. The last time a Doji showed up on January 24th, USDZAR gained 1.47% on the following trading day.
Prices are trading close to the key technical support level at 17.1772 (S1). After having been unable to move lower than 17.1772 in the previous session, USD/ZAR found buyers again around the same price level today at 17.2371.
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 17.1772 where further sell stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "3 Consecutive Lower Closes" stand out. Its common bearish interpretation has been confirmed for USD/ZAR. Out of 175 times, USDZAR closed lower 52.57% 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 two trading days, showing a win rate of 55.43% with an average market move of -0.08%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 2.72% and NZDUSD closing 1.88% higher. On the flipside the worst performers have been USDCHF closing -1.43% lower and USDJPY losing -1.42%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPHKD surging 2.72% and GBPZAR closing 2.65% higher. The worst performers of the day have been USDMXN tanking -4.12% and USDNOK closing -3.12% lower. Read more