Dukascopy Bank Team
Dukascopy Bank SA
EUR/NOK 1H Chart: Channel Down
Comment: The channel was formed after the currency pair broke out of the rising wedge to the downside. However, we should not be deceived by the bearish outlook implied by the currently emerging pattern. This situation highlights the importance of analysis of the higher time frames. In this example, in the daily chart EUR/NOK approaches a major up-trend, which is more likely to stay intact than the falling resistance line. Accordingly, our expectation is a sell-off from 9.40, while a subsequent rally from 9.29 is likely to result in a break-out to the upside, in which case the weekly PP and 200-hour SMA circa 9.47 are to become the primary objective, followed by Sep 30 and Sep highs at 9.56 and 9.63, respectively.
USD/CAD 1H Chart: Channel Down
Comment: After USD/CAD topped out at 1.3457 the pair has been in a strong down-trend, but there are few ‘sell’ signals at the moment, and the trend may not continue much further. The technical indicators are mixed, and the price itself is closing in on the solid support at 1.30, represented by the lower boundary of the bearish pattern and also last month’s low. If this is not enough to stop the bears from pushing the price lower, the next target it likely to be 1.2950, while in the long run we could see a test of the major up-trend at 1.26. On the other hand, a break-out to the upside (a close above 1.31) will likely lead to an extension of the recovery up to 1.3300/1.3250 (weekly PP and 200-hour SMA).
This overview can be used only for informational purposes. Dukascopy SA is not responsible for any losses arising from any investment based on any recommendation, forecast or other information herein contained.
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