Based on a long-term analysis of historical data, the average positive and negative daily returns are approximately 1.03% and -1.07% , respectively. The estimated daily return in both directions based on their probability of occurrence is 0.53% and -0.50% . Friday´s return was 2.18% . Our scoring is currently positive (1 ) for the month-on-month change and 1 for price indexation. Both scorings range from -3 up to 3 . Indexation is currently in a slightly positive phase of the cycle. The estimated cycles development based on our analytical system is shown in the following chart.
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 XPT/USD has had a positive upward momentum in recent days. Therefore, as we can see in the chart below, all MAs still support bullish sentiment.
Since the beginning of this year, we have witnessed more growing trends, with the maximum level reaching 6 consecutive days. This is also the overall maximum for the last 3 years. The downward trends did not exceed more than 5 days in the same period. The total maximum in the measured period (last 3 years) is 7 days. We could use the average annual ATR (Average True Range) obtained from daily data (3.65% ) to estimate Stop Loss orders for our positions. The current value is 3.02% . Approximately 90% confidence interval (return between -2.5% and 2.0% ) is shown in the histogram below by a red rectangle.
We could use the last decile of low to high returns (3.50% ) to estimate Profit Targets, as shown in the chart below.
Basic technical analysis still supports medium-term bullish sentiment, as the price of a commodity creates higher lows and higher highs. The XPT/USD recently rebounded from the Fibonacci retracement level of 23.60% . This scenario could also support the divergence between price development and the RSI, which was created from November to March. Price level 1 250 may represent short-term resistance. After breaking this level, the psychological level of 1 300 can be tested. However, if the price does not break above 1 250 and, on the contrary, begins to fall, the next stop could be the psychological level at 1 100 or the demand zone (green rectangle), where the Fibonacci retracement level of 38.20% is also, along with a long-term moving average and another strong level of 1 000 .