Beginning just over a week ago, the euro entered a bearish trend against the Norwegian krone. While the EUR/NOK pair has tumbled over 1800 pips since the 29th of November, there is considerable technical evidence that an upward correction may take place in the near future.
We will be examining the daily EUR/NOK chart, provided by Forexyard. The technical indicators being analyzed are the Relative Strength Index (RSI), Stochastic Slow and Williams Percent Range.
1. The RSI has been falling for some time, and has gone into oversold territory. Currently right around the 20 level, traders can take this is a sign that a bullish correction is likely to take place.
2. The Stochastic Slow, which has formed a cross below the lower support line, is currently indicating a reversal is likely to take place.
3. Finally, the Williams Percent Range has been trading below the -80 level for some time. This is typically seen as a sign that the pair is trading in oversold territory. Traders would be wise to take advantage of this data and enter into long positions in order to capitalize on the impending upward correction.
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Dan Eduard is a Market Strategist with ForexYard. His addition to the ForexYard team has brought a unique new perspective to our clients. Dan's ability to compare and contrast trans-national issues with events in the market is uncanny and many clients so far have used his advice to make leaps and bounds in their trading strategies. He has been published on the ForexYard Trading Blog and affiliate websites. He carries a BA in Political Science and an MA in History.
