Based on a long-term analysis of historical data, the average positive and negative daily returns are approximately 1.47% and -1.53% , respectively. The estimated daily return in both directions based on their probability of occurrence is 0.75% and -0.70% . Friday´s return was 0.13% , well below the first standard deviation. Our scoring is currently neutral (0 ) for the month-on-month change and 0 for price indexation. It is currently in the extreme growth phase of the cycle. Both scorings range from -3 up to 3 . The development of the estimated cycles based on our analytical system is shown in the following chart.
Source: WALFIR
Different moving averages (MAs) help us better identify trends across multiple time frames. We use 3 basic MAs to find out which sentiment dominates each horizon. The purple line represents the monthly , the green line the 6 months and the yellow line the annual moving average. The price of XPD/USD has strengthened over the last month. Therefore, all MAs still support bullish sentiment. The monthly MA could be an important support if the price falls.
Source: WALFIR
After our analysis, we have witnessed more declining trends, with the maximum level reaching 5 consecutive days. The total maximum in the measured period (last 3 years) is the same. The upward trends did not exceed more than 3 days in the same period. However, the maximum in the measured period is 14 days. We could use the average long-term ATR (Average True Range) obtained from daily data (3.29% ) to estimate Stop Loss orders for our positions. The current value is 2.09% , which is below the average. Approximately 90% confidence interval (return between -3.0% and 3.0% ) is shown in the histogram below by a red rectangle.
Source: WALFIR
We could use the last decile of low to high returns (5.25% ) to estimate Profit Targets, as shown in the chart below.
Source: WALFIR
The basic technical analysis points to volatile development since the beginning of this year. The medium-term correction was replaced by short-term growth. XPD/USD is currently very close to the short-term moving average, which could be an important price support. In addition, it is also located in the demand zone (green rectangle), where is the psychological level of 2 750 . However, the divergence between the price development and the RSI could support the opposite scenario.
Source: TradingView
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