USD/SEK 4H Chart: Channel Down

Source: Dukascopy Bank SA
© Dukascopy Bank SA
There is a bearish channel emerging in the four-hour chart of USD/SEK. And while there is a possibility of a rally in the near future, as the currency pair has just tested the lower boundary of the pattern, the upside is to be limited by the falling resistance line and the monthly S2 circa 8.25. There we expect the bears to regain control of the pair and push the price lower, considering that most of the four-hour and daily technical indicators are pointing south. However, we should be wary of the nearby significant support levels, such as the monthly S3 at 8.1420 and the October 2015 low at 8.0956, which pose a threat to the downward momentum, though we expect the sell-off to extend down to 8.0320 before there is a noticeable bullish reaction.
© Dukascopy Bank SA
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