Based on a long-term analysis of historical data, the average positive and negative daily returns are approximately 1.48% and -1.53% , respectively. The estimated daily return in both directions based on their probability of occurrence is 0.75% and -0.71% . Yesterday´s return was 0.21% , well below the first standard deviation. Our scoring is currently neutral (0 ) for the month-on-month change and 2 for price indexation. It is currently in a slightly positive 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 XPD/USD rose again above the short-term MA this week. Therefore, as we can see in the chart below, only medium and long-term MAs currently support bearish sentiment.
Source: WALFIR
Since our last analysis, we have witnessed more rising trends, with the maximum level reaching 3 consecutive days. The maximum for the last 3 years is 14 days. The downward trends have not exceeded more than 1 day in the last period. However, the maximum in the measured period is 6 days. We could use the average long-term ATR (Average True Range) obtained from daily data (2.95% ) to estimate Stop Loss orders for our positions. The current value is 0.81% , which is well below 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 a short-term uptrend, as the market price creates higher highs and higher lows. However, it is approaching a very important psychological level at 2 200 , which could act as resistance to the market price. In addition, slightly higher, there is also the Fibonacci retracement level of 50.00% . The current positive development was supported at the demand zone (green rectangle), where is also the Fibonacci retracement level of 78.60% . The divergence between price developments and the RSI created in late September and early October also motivated the bulls.
Source: TradingView
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