USDNOK closes higher for the 2nd day in a row
US Dollar/Norwegian Krone (USDNOK) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, USDNOK finished the month -4.5% lower at 9.1004 after edging higher 178 pips (0.2%) today. Trading up to 548 pips lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Tuesday, USDNOK actually lost -1.04% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (USDNOK as at Jul 31, 2020):
Friday's trading range has been 1258 pips (1.39%), that's slightly below the last trading month's daily average range of 1291 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for USDNOK. Prices continued to consolidate within a tight trading range between 9.0107 and 9.1915 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical support level at 9.0107 (S1). The FX pair found buyers again today around 9.0196 for the third trading day in a row after having found demand at 9.0176 in the previous session and at 9.0107 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could speed up should prices move above the nearby swing high at 9.1716 where further buy stops might get activated. Selling could accelerate should prices move below the close-by swing low at 9.0107 where further sell stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Spinning Top" stand out. Its common bullish interpretation has been confirmed for USD/NOK. Out of 284 times, USDNOK closed higher 53.52% 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 55.63% with an average market move of 0.49%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are NZDUSD losing -1.04% and AUDUSD closing -0.72% lower. On the flipside the best performers have been USDJPY closing 1.12% higher and USDCHF gaining 0.48%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDZAR surging 1.87% and GBPZAR closing 1.79% higher. The worst performers of the day have been NZDCAD tanking -1.15% and NZDHKD closing -1.05% lower. Read more