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 only 0.43% , well below the first standard deviation. Our scoring is currently positive (1 ) for the month-on-month change and 2 for price indexation. Both scorings range from -3 up to 3 . Indexation is currently in the initial positive phase of the cycle. 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. In the case of monthly MA, XPT/USD is clearly in bearish sentiment. The 6 months MA could be support for the price. The annual MA still supports bullish sentiment.
Source: WALFIR
In recent weeks, we have witnessed more declining trends that did not exceed 5 days. The total maximum in the measured period (last 3 years) is 7 days. Upward trends did not exceed more than 3 days in the same period. The total maximum for the last 3 years is 6 days. We could use the average long-term ATR (Average True Range) obtained from daily data (3.53% ) to estimate Stop Loss orders for our positions. The current value is 3.31% . Approximately 90% confidence interval (return between -2.40% and 2.40% ) is shown in the histogram below by a red rectangle.
Source: WALFIR
We could use the last decile of low to high returns (3.60% ) to estimate Profit Targets, as shown in the chart below.
Source: WALFIR
Basic technical analysis still supports long-term bullish sentiment as the commodity price creates higher highs and higher lows. The short-term outlook is more negative. XPT/USD is currently very close to the Fibonacci retracement level of 23.60% . This could be strong support for the price. However, we must see a movement above the short-term moving average and the psychological level of 1 200 . In the event of a further decline, there is the demand zone (green rectangle) with the psychological level of 1 100 . This scenario could also support the divergence between price development and the RSI, which was created from April to May.
Source: TradingView
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