Will EUR/NOK rebound again?

EUR/NOK traded lower on Friday, after hitting resistance near the 10.9315 zone overnight. Overall though, since yesterday, the pair has been trading above a prior downside resistance line drawn from the high of April 22^nd, and thus, we would consider the short-term outlook to be somewhat positive.

If the bulls are strong enough to retake charge at some point soon, we would expect them to aim for another test at 10.9315 and if they manage to overcome that zone, we may see them targeting the 11.0130 barrier, which is the high of May 22^nd. Another break, above 11.0130 could pave the way towards the peak of May 15^th, at 11.1035.

Shifting attention to our short-term oscillators, we see that the RSI topped within its above-70 zone and just crossed back below 70, while the MACD, although above both its zero and trigger lines, shows signs of topping as well. Both indicators detect slowing upside speed and suggest that some further retreat may be in the works before the next positive leg, perhaps for the rate to challenge the 10.7100 or 10.6460 support zones.

In order to start examining whether the outlook has turned negative again, we would like to see a dip below 10.4536. This would confirm a forthcoming lower low and may initially set the stage for declines towards the 10.3700 barrier, which is defined as a support by the inside swing low of March 4^th. If that zone is not able to stop the slide either, then we may see the bears diving towards the 10.2760 area, which provided strong support between March 3^rd and 5^th.

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