EUR/NOK accelerated lower during the European morning Wednesday, breaking below the support (now turned into resistance) barrier of 9.7350. The pair has been in a sliding mode since yesterday, when the rate hit resistance near 9.7900. That said, since February 13th, the short-term path has been a trendless one, between the aforementioned resistance and the 9.7100 support zone, something confirmed by our moving averages, all of which have been moving sideways. Therefore, we will adopt a flat stance for now and wait for the rate to exit the short-term range.
At the time of writing, the pair is nearing the lower end of that range, near 9.7100, the break of which may encourage the bears to add to their positions and perhaps drive the battle towards the lows of February 4th and 5th, at around 9.6650. Another dip below that hurdle may extend the slide towards our next support zone, at around 9.6450. That support is defined by the lows of January 31st and February 1st.
Looking at our short-term oscillators, we see that the RSI runs below 50 and looks to be heading towards 30, while the MACD has just turned below both its zero and trigger lines. These indicators detect downside speed and support the case for some further declines. However, we prefer to wait for a decisive dip below 9.7100 before we start examining the bearish case.
On the upside, a move above the key resistance zone of 9.7900 would confirm a forthcoming higher high on the 4-hour chart and may signal that the bulls have gained the upper hand. Such a break may set the stage for bullish extensions towards the high of February 11th, near 9.8400. Another break, above 9.8400, could encourage the bulls to put the 9.8600 level on their radars, a resistance marked by the inside swing low of January 2nd.
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