Euro/Scandi Crosses Looking to Break Higher Post Short-Term Weakness

DailyFX   |  February 8 2012 12:57 EST

A daily overview of technical developments in the regional currencies. Take a look inside for the latest scoop on the Norwegian Krone and Swedish Krona.

Eur/SekThe market remains under some intense pressure, with the latest setbacks threatening a return to the key lows from early 2011 by 8.70. However, daily studies are now tracking in oversold territory and any additional setbacks should prove to be very well supported once again towards 8.70. Ultimately, only a close back below 8.70 would give reason for concern, while dips towards the figure are viewed as formidable buy opportunities.

Usd/SekThe market looks to be in the process of a major structural shift, with the latest multi-day consolidation broken to confirm the formation of a higher low and next major upside extension beyond 7.00. Recent setbacks have been well supported by previous resistance at 6.30 to further confirm constructive outlook and expose a retest of the critical November 2010 highs by 7.07 further up. Above 7.07 open next upside extension towards 7.50 further up, while any interday declines should find renewed bids ahead of 6.50.

Usd/Nok The market looks to be in the process of a major structural shift, with the latest multi-day consolidation broken to confirm the formation of a higher low and next major upside extension beyond 6.00. Recent setbacks have been well supported by previous resistance at 5.40 to further confirm constructive outlook and expose a sustained break of the 6.00 handle. Next key resistance at 6.25 now in focus, while setbacks should be well supported ahead of 5.70.

Eur/NokWe believe are finally starting to see the formation of a potential base in the cross following the latest sharp bounce out from some very solid support in the 7.50 area. From here, look for an acceleration of gains through the multi-week range highs by 7.95, with further acceleration expected on a break above 8.00. Only back below 7.60 concerns.

--- Written by Joel Kruger, Technical Currency Strategist

To contact Joel Kruger, email jskruger@dailyfx.com. Follow me on Twitter @JoelKruger

To be added to Joel Kruger’s distribution list, send an email with subject line “Distribution List” to jskruger@dailyfx.com