The pound sterling is erasing some of its loss after it dipped to 13.54 support from the 13.90 resistance against the Norwegian Krone. The pair trades at about 13.64 in today’s trading session. Interestingly, the awesome oscillator divergence forecasted the decline that began on May 1st.
Regardless of the recent downtrend, the primary trend remains bullish because the price of GBPNOK hovers above EMA 50.
GBPNOK Bullish Flag Formation
Zooming into the 4-hour chart shows the currency pair has been trading in a narrow bullish flag since May 6th. Despite the bull’s failure to surpass the 38.2% Fibonacci (the 13.68 mark), our outlook will remain positive for the pound sterling to keep recovering against the Norwegian Krone.
The technical indicators agree with the primary trend, which is Bullish. The AO’s bars are in green, approaching the zero line from below, while the RSI indicator also approaches the median line and tries to close above it.
GBPKOK Forecast – Bulls Eye 13.7 Mark
From a technical standpoint, the recent rise in the GBPNOK price will likely expand further to the 50% Fibonacci resistance, the 13.7 mark. This barrier is robust with the EMA 50 and the Ichimoku cloud. Therefore, traders and investors should monitor this level closely if the price arrives at this level. The uptick momentum can ease near strong resistance zones, such as the 13.72 mark.
The Bearish Scenario
On the flip side, the 13.54 supply zone and EMA 50 divide the bull market from the bear market. The bullish outlook should be considered invalid if the GBPNOK price dips below EMA 50. In this case, the downtrend that began on May 1st from 13.90 will likely target the February high, the 13.43 mark.
J.J Edwards is a finance expert with 15+ years in forex, hedge funds, trading systems, and market analysis.
