REVIEW
EUR/NOK continues its path lower. The pair has been in a downtrend since the 21st of December last year. For the whole of last week, the Norwegian Krone was strengthening against the common currency, where only on Friday the bulls managed to get a breath of fresh air and close the day with minor gains. It is interesting to also point out that the pair started forming a falling wedge, since the aforementioned reversal to the downside.
OUTLOOK (SCENARIO A / B)
For now, we remain bearish and we could expect a further slide towards the lower side of the previously mentioned wedge. But before the pair could make its way there, it has to break through some key areas of support. The first one to watch is the 9.400 area, which twice held strong in June and didn’t allow the rate to drop further. Maybe the third attempt could be lucky for the bears. A drop below that level, opens the path to the slightly lower support at 9.355, which could be the last key level of support for EUR/NOK before it reaches the lower side of the wedge. Also, a good area to watch there could be the 9.296 zone, marked near the lowest point of October 2017.
On the upside, a move to, and eventually a break of, the 9.469 hurdle, marked by last Thursday’s high, could interest the bulls in jumping in and driving EUR/NOK towards last week’s highs at around 9.529. Certainly, if this won’t be enough for the bulls then we could see them talking the pair all the way up to the upper bound of the wedge for a quick test.
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