NOKUSD unable to break through key resistance level

Norwegian Krone/US Dollar (NOKUSD) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team


NOKUSD runs into sellers around 0.1109 for the third day in a row
NOKUSD closes below its opening price unable to hold early session gains
NOKUSD unable to break through key resistance level
NOKUSD closes lower for the 2nd day in a row
NOKUSD still stuck within tight trading range


Moving lower for the 2nd day in a row, NOKUSD finished the month 4.77% higher at 0.1099 after edging lower 2 pips (-0.18%) today. Trading 7 pips higher after the open, the forex pair was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.

Daily Candlestick Chart (NOKUSD as at Jul 31, 2020):

Daily technical analysis candlestick chart for Norwegian Krone/US Dollar (NOKUSD) as at Jul 31, 2020

Friday's trading range has been 16 pips (1.45%), that's slightly above the last trading month's daily average range of 15 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NOKUSD. Prices continued to consolidate within a tight trading range between 0.1088 and 0.1110 where it has been caught now for the whole last trading week.

Three candlestick patterns are matching today's price action, the Tweezer Top which is known as bullish pattern and two bearish patterns, the Bearish Spinning Top and the Bearish High-Wave Candle. The last time a Tweezer Top showed up on July 7th, NOKUSD gained 1.14% on the following trading day.

Unable to break through the key technical resistance level at 0.1102 (R1), the pair closed below it after spiking up to 0.1109 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. The market ran into sellers again today around 0.1109 for the third trading day in a row after having found sellers at 0.1109 in the previous session and at 0.1110 two days ago.

The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.

Buying could speed up should prices move above the close-by swing high at 0.1110 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 0.1090 where further sell stops might get triggered.

Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Its common bearish interpretation has been confirmed for NOK/USD. Out of 250 times, NOKUSD closed lower 50.80% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 58.40% with an average market move of -0.52%.

Market Conditions for NOKUSD as at Jul 31, 2020

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