Will EUR/NOK Fall Below the Key Support of 10.350 Soon? | Technical Analysis

EUR/NOK traded in a consolidative manner yesterday, staying slightly above the key support zone of 10.350, which has been acting as a floor for the pair since July 15th. Despite the steep fall from August 20th until August 25th, the overall price structure does not point to a clear trending direction and thus, we prefer to stay neutral for now.

In order to start examining the case of more declines, we would like to see the rate breaking that key support of 10.350. This will confirm a forthcoming lower low on both the 4-hour and daily charts and may encourage declines towards the low of July 12th, at 10.267, or the low of July 7th, at 10.232. If the bears are not willing to stop there, then a break lower could see scope for more declines, perhaps towards the low of July 6th, at around 10.137.

Looking at our short-term oscillators, we see that the RSI turned sideways near its 30 line, while the MACD, although negative and slightly below its trigger line, has also turned sideways. Although both indicators confirm the latest strong downside momentum, the fact that the have now turned flat confirms our choice to wait for a dip below 10.350 before getting confident on more declines.

On the upside, we would like to see a decent recovery above 10.454 before we assume that the bulls have gained control, at least temporarily. Such a move may pave the way towards the high August 23rd, the break of which could see scope for extensions towards the peak of August 20th, at 10.633.


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Thank you for your analysis. Will the Jackson Hole Symposium impact this pair?

We believe that this pair will not be affected that much. We see the case for more reaction by the dollar, and especially against risk-linked currencies like the Aussie, and the equity markets. Thank you very much.