EURNOK closes lower for the 3rd day in a row
Euro/Norwegian Krone (EURNOK) Technical Analysis Report for Dec 13, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, EURNOK ended the week -0.52% lower at 10.0422 after tanking 642 pips (-0.64%) today on high volume. This is the biggest single-day loss in over a month. Today's close at 10.0422 marks the lowest recorded closing price since October 11th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 10.0925, the forex pair confirmed its breakout through the previous session low after trading up to 573 pips below it intraday.
Daily Candlestick Chart (EURNOK as at Dec 13, 2019):
Friday's trading range has been 902 pips (0.89%), that's far above the last trading month's daily average range of 636 pips. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EURNOK.
Two candlestick patterns are matching today's price action, the Black Candle and the Three Black Crows which are both known as bearish patterns. The last time a Three Black Crows showed up on January 3, 2013, EURNOK actually gained 0.48% on the following trading day.
Unable to break through the key technical resistance level at 10.1243 (R2), the FX pair closed below it after spiking up to 10.1254 earlier during the day. The failure to close above the resistance could increase that levels significance going forward.
Crossing below the lower Bollinger Band for the first time since September 9th, prices have shown unusually strong downward momentum in the short-term. This might either indicate a potential selling climax after which prices could head back up towards the mean of the Bollinger Bands at 10.1201 or signal the beginning of a strong momentum breakout leading to even lower prices.
Although the currency is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Further selling could move prices lower should the market test November's nearby low at 10.0234.
Among the 14 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Three Black Crows" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for EUR/NOK. Out of 1 times, EURNOK closed higher 100.00% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 100.00% with an average market move of 2.15%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are AUDUSD losing -0.49% and USDCAD closing -0.12% lower. On the flipside the best performers have been GBPUSD closing 1.2% higher and USDJPY gaining 0.04%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPAUD surging 1.63% and GBPZAR closing 1.37% higher. The worst performers of the day have been EURGBP tanking -1.3% and USDNOK closing -0.56% lower. Read more