NOK keeps pointing higher – Danske Bank

Mathias Mogensen, Analyst at Danske Bank, expects the Norwegian Krone to pick up extra pace in the next months.

Key Quotes

“As expected, Norges Bank gave nothing new to markets last week, yet it is noteworthy how EUR/NOK kept edging lower supported by higher NOK rates and the oil price as well as reduced housing market concerns”.

“Fundamentally, we still see a case for a stronger NOK in the months to come and hence we still like our strategic NOK positions: long NOK/SEK spot and short EUR/NOK via options”.

“From a purely tactical perspective, however, we do think it is worth pointing out that EUR/NOK has approached important technical support levels; also EUR/NOK RSI indicators have historically not been this low without short-term setbacks”.

“With no forthcoming turning points in the moving averages, we think a key challenge for the NOK this week is if the EUR/NOK spot can stay below the 100D moving average (9.5875)”.