Based on a long-term analysis of historical data, the average positive and negative daily returns are approximately 1.03% and -1.08% , respectively. The estimated daily return in both directions based on their probability of occurrence is 0.53% and -0.51% . Friday´s return was 2.90% , which is exactly the second standard deviation. Our scoring is currently positive (2 ) for the month-on-month change and 1 for price indexation. Both scorings range from -3 up to 3 . Indexation is currently in a growing 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. For all MAs, XPT/USD is in bearish sentiment. However, the monthly MA could be the first resistance for the market price.
Source: WALFIR
Since our last analysis, we have witnessed higher upward trends, even though the price is lower. They did not exceed 4 days. The total maximum in the measured period (last 3 years) is 6 days. Downward trends did not exceed more than 3 days in the same period. The total maximum for the last 3 years is 7 days. We could use the average long-term ATR (Average True Range) obtained from daily data (3.33% ) to estimate Stop Loss orders for our positions. The current value is 3.21% , which is very close to the average. 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
Since the beginning of this year, the basic technical analysis has supported bearish sentiment as the price of the commodity is creating lower lows and lower highs. The medium-term outlook is more positive. Yesterday, XPT/USD bounced off an important area, where are the Fibonacci retracement level of 50.00% and the psychological level of 1 000.00 . The divergence between price development and the RSI also supports the bullish scenario.
Source: TradingView
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