Technical Update - EURNOK & EURSEK uptrends sending exhaustion signals Technical Update - EURNOK & EURSEK uptrends sending exhaustion signals Technical Update - EURNOK & EURSEK uptrends sending exhaustion signals

Technical Update - EURNOK & EURSEK uptrends sending exhaustion signals

Forex 3 minutes to read
Kim Cramer Larsson

Technical Analyst, Saxo Bank

Summary:  EURNOK could be drawing a Shoulder-Head-Shoulder pattern in an exhausting move with downside potential below 11.00
EURSEK indicators suggesting uptrend exhaustion. Confirmation is needed. 11.50 is likely to be key support

EURNOK bounced from just above the 100 daily Moving Average and support at around 11.38 and is now testing the medium-term rising trendline. At first attempt of getting back above the trendline EURNOK has been rejected.
Sentiment is still down as illustrated by RSI and needs to close above 60 threshold to change that.

Is EURNOK forming a Shoulder-Head-Shoulder pattern with a downwards sloping Neckline?
If EURNOK slides back to close below last week’s low at around 11.40 we can calculate the potential downwards price target to around 10.80. That potential target level is also close to the 0.618 retracement of the November 2022 – May 2023 uptrend (see weekly chart)
There is however, strong support at around 11.20.
The RSI divergence on weekly chart indicates uptrend exhaustion.

If EURNOK manages to close above the rising trendline previous peak at around 12.07 could be tested thereby demolishing the SHS pattern.

A move above 12.07 is likely to sent EURNOK towards all-time high levels around 13.00


Source all charts and data: Saxo Group

EURSEK uptrend, which has recorded an all-time high, is in exhaustion mode as indicated by RSI divergence on both daily and weekly chart.
If EURSEK breaks below its short-term rising trendline it could be first indication of a larger correction. A close below 11.50 will confirm that scenario that could take EURSEK down toa around 11.20 i.e., the 0.382 retracement and support.

However, the trend is still up – a close below 11.50 will change that – and if EURSEK trades above 11.80 the RSI divergence is likely to be cancelled with a new all-time high in EURSEK to follow.


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