USDSEK has been range-bound over the past week as the pair pauses after two months of heavy losses. Upside momentum has been gaining ground during the past week according to the stochastics, with the %K and %D lines trending up to rise above 50. However, the RSI is indicating only an easing of the bearish bias as it remains below the 50-neutral level and its flat direction suggests the consolidation will continue in the near-term.
Should the upside momentum gain further traction, immediate resistance should come at the top of the current range at 8.0200. Further up, the area around 8.12 could act as another hurdle as this has been a heavily congested region in the past. Above this area, the 50-day moving average (MA) comes into focus (currently at 8.17), followed by the previous resistance level of 8.225. A break above the 50-day MA would shift the bias to positive.
To the downside, the bottom of the range at 7.9065 is the nearest support. A break of this level would take the pair towards the May 2016 low of 7.8913. Further declines below this trough would deepen the bearish bias not only in the short term but also in the medium term, and open the way towards the 7.50 level.
