By Dan Eduard – For our technical analysis, we will be looking at the 8-hour chart for the EUR/NOK pair provided by ForexYard. As will be shown, the pair is currently trading in oversold territory and will likely see an upward correction in the near future.
The technical indicators being used are Bollinger Bands, Relative Strength Index (RSI) and Stochastic Slow.
1. As shown on the chart, the pair is currently trading on the border of the lower Bollinger Band. This typically indicates an upward correction is imminent. Furthermore, the Bollinger Bands are beginning to widen, meaning a major price shift could occur in the near future.
2. The RSI shows the pair currently trading around the 20 line, well into oversold territory. When traders see the RSI at such a low point on the chart, they can take it as a sign that bullish movement could occur soon.
3. Traders can see a cross already formed on the Stochastic Slow lines at the bottom of the chart. Typically, when such a cross occurs, the pair begins to see some upward momentum. This further corroborates our original theory that a bullish correction is likely to take place.
Forex Market Analysis provided by Forex Yard.
© 2006 by FxYard Ltd
Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.
