EURSEK finds buyers at key support level
Euro/Swedish Krona (EURSEK) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, EURSEK finished the week 0.24% higher at 10.2441 after edging higher 39 pips (0.04%) today. Trading up to 376 pips lower after the open, the currency managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (EURSEK as at Jan 11, 2019):
Friday's trading range has been 581 pips (0.57%), that's below the last trading month's daily average range of 808 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for EURSEK. Prices continued to consolidate within a tight trading range between 10.1728 and 10.2657 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Northern Doji which is known as bearish pattern and one neutral pattern, the Doji.
After trading down to 10.2058 earlier during the day, EUR/SEK bounced off the key technical support level at 10.2424 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on December 28, 2018, EURSEK actually lost -1.22% on the following trading day. After spiking up to 10.2639 during the day, the forex pair found resistance at the 20-day moving average at 10.2629. After having been unable to move above 10.2657 in the previous session, the pair ran into sellers again around the same price level today, missing to move higher than 10.2639.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 10.2657 where further buy stops could get activated. Selling might accelerate should prices move below the nearby swing low at 10.1728 where further sell stops could get triggered. Further selling might move prices lower should the market test December's close-by low at 10.1176.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 20" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for EUR/SEK. Out of 183 times, EURSEK closed higher 50.27% 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 55.74% with an average market move of 0.21%.
With five out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.71% and NZDUSD closing 0.69% higher. On the flipside the worst performers have been EURUSD closing -0.27% lower and USDCHF losing -0.09%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been NZDCAD surging 0.98% and GBPCAD closing 0.97% higher. The worst performers of the day have been EURNZD tanking -1.04% and EURGBP closing -0.99% lower. Read more