EUR/PLN has been constrained by a channel down since mid-September. Given that the Euro has been trading with diminishing trading range, a falling wedge would be more precise depiction.
The bottom line of this pattern was tested last week when the rate reversed from the 4.1425 area. Its subsequent movement was tended northwards within a narrow and steep ascending channel.
Technical indicators suggest that the rate is likely to edge lower in this session. However, even if the 200-hour SMA is breached, the combined support of the 55– and 100-hour SMAs and the weekly PP is located nearby circa 4.1590. This area is expected to provide a strong barrier, thus resulting in a reversal back north.
A near-term upside target is the upper wedge boundary and the monthly PP near 4.19.