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.
Disclaimer:
The content we produce does not constitute investment advice or investment recommendation (should not be considered as such) and does not in any way constitute an invitation to acquire any financial instrument or product. The Group of Companies of JFD, its affiliates, agents, directors, officers or employees are not liable for any damages that may be caused by individual comments or statements by JFD analysts and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his investment decisions. Accordingly, you should seek, if you consider appropriate, relevant independent professional advice on the investment considered. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances or needs. The content has not been prepared in accordance with the legal requirements for financial analyses and must therefore be viewed by the reader as marketing information. JFD prohibits the duplication or publication without explicit approval.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.90% of retail investor accounts lose money when trading CFDs with the Company. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. Please read the full Risk Disclosure.
Copyright 2021 JFD Group Ltd.