Following a reversal from a seven-month high of 8.52 mid-December, the US Dollar has been moving in a channel down against the Swedish Krona. The upper boundary of this pattern was tested on February 9—a move which was followed by a slight period of depreciation.
It seems that the pair is currently standing at the crossroads of two scenarios. On the bearish side, the pair should breach the 200-hour SMA and edge lower in line with the medium-term channel. A possible target within the following two weeks could be the 2016/2018 low of 7.8221. Technical indicators suggest that this is the more likely scenario.
On the other hand, the pair might fail to sustain its bearish movement in the steep channel down, thus resulting in a soon breakout north. The pair might even respect the three-week ascending channel and breach the 55– and 100-hour SMAs near 8.06. A surge up to the 24.60% Fibo retracement at 8.2053 is expected to follow.
It seems that the pair is currently standing at the crossroads of two scenarios. On the bearish side, the pair should breach the 200-hour SMA and edge lower in line with the medium-term channel. A possible target within the following two weeks could be the 2016/2018 low of 7.8221. Technical indicators suggest that this is the more likely scenario.
On the other hand, the pair might fail to sustain its bearish movement in the steep channel down, thus resulting in a soon breakout north. The pair might even respect the three-week ascending channel and breach the 55– and 100-hour SMAs near 8.06. A surge up to the 24.60% Fibo retracement at 8.2053 is expected to follow.