News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
EUR/USD
Mixed
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Bearish
GBP/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
USD/JPY
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • #Gold has continued to step back from the one month high hit around 1,755 last week, dropping to a fresh six day low around the 1,730 level today. $XAU $GLD https://t.co/I3qpQ1k7MR
  • Commodities Update: As of 16:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.54% Gold: -0.69% Silver: -1.79% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/oC1w9BWJTn
  • - Hopeful that the economy can switch to high-productivity growth after the pandemic - Appetite for holding liquid government debts is insatiable and this trend does not look to be reversing
  • USD/CAD attempts to retrace the decline following the update to Canada’s Employment report in an effort to retain the opening range for April. Get your $USDCSD market update from @DavidJSong here:https://t.co/TZ7s4X1VXF https://t.co/aqycOmCINp
  • - Will defer to Chair Powell to begin tapering discussion - We remain on the lookout for financial stability risks - Improved regulatory frameworks put in place since the financial crisis have helped mitigate these risks
  • Forex Update: As of 16:00, these are your best and worst performers based on the London trading schedule: 🇨🇭CHF: 0.26% 🇯🇵JPY: 0.23% 🇬🇧GBP: 0.23% 🇦🇺AUD: 0.01% 🇳🇿NZD: -0.03% 🇨🇦CAD: -0.22% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/LXnEJybdjH
  • - Pandemic has not yet come to a close in the US - Still too early to talk about changing monetary policy - Want to maintain easy policy while we're still in the pandemic
  • British Pound Technical Analysis: GBP/USD, GBP/JPY, EUR/GBP https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2021/04/12/british-pound-gbp-sterling-technical-analysis-gbpusd-gbp-usd-gbpjpy-gbp-jpy-eurgbp-eur-gbp.html https://t.co/O0tr0BA9ZG
  • Fed's Bullard: - Sees US growth at 6.5% in 2021 - Base effects in inflation will make numbers hard to interpret - We remain in a period of uncertainty about inflation and will not know for sure until the dust has settled later this year #Fed $USD
  • Indices Update: As of 16:00, these are your best and worst performers based on the London trading schedule: France 40: 0.02% FTSE 100: -0.03% Germany 30: -0.05% Wall Street: -0.07% US 500: -0.08% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/Rwina1eAS0
Too Much of a Good Thing for USD/NOK

Too Much of a Good Thing for USD/NOK

Rafiul Hossain, Head Forex Trading Instructor

Talking Points:

  • 2 Upside Targets Taken Out in Record Speed
  • Sudden Overbought Signals from RSI, Stochastic
  • The Most Prudent USD/NOK Strategy for Now

So far, November has been a good month for the US dollar (USD) against most currency counterparts, including the Norwegian krone (NOK). The dollar and US economy have both been supported by stronger macro numbers, and as a result, the two USDNOK price targets we highlighted on October 29 (6.05 and 6.20) were reached in a hurry.

See recent: A Potential Bargain Buy in USD/NOK

Now, having gone too far, too fast, USDNOK is overbought in the short term, as signaled by both the RSI and Stochastic indicators. This might favor some retracement or even a rough and sudden pullback in USDNOK in the coming days and/or weeks.

With that said, there’s always a train to catch when it comes to forex trading, and while USDNOK isn’t permanently out of play, traders must now exercise patience and find a better long-entry point that will offer more favorable risk/reward.

Technical Outlook for USD/NOK

USDNOK broke earlier highs around 6.13/6.15, which caused the pair to spike above 6.20 with lightning speed. As indicated below, both the RSI (above 70) and Stochastic (above 80) suggest that the pair has become overbought in the short term.

Guest Commentary: Technical Outlook for USD/NOK

Too_Much_of_a_Good_Thing_for_USDNOK_body_GuestCommentary_RafiulHossain_November12A.png, Too Much of a Good Thing for USD/NOK

Support: 6.13/6.07, 6.00/5.95, 5.80/5.83

Resistance: 6.20/6.25, 6.30, 6.50

Furthermore, this most recent move started from the lower 5.90’s without any pause and without forming a base for greater support on the way back. In that respect, we should be especially careful in upcoming days and/or weeks until both the RSI and Stochastic can return to normal levels in preparation for another possible leg up.

On the upside, we have established resistance at a yearly high around 6.25. If we manage to break and establish above this area, the next possible resistance is around 6.30 and then all the way to 6.50.

On the downside, we should find support around 6.15/6.13 and then again at 6.07, although it wouldn’t be a surprise if we went on to re-test the breakout area around 6.00 (former trend line).

In the long term, USDNOK has put in higher lows and higher highs, which favors a positive move in due time. In the short term, however, the current move seems a bit overstretched, but after a healthy retracement, we may well find a better long-entry point and more favorable risk/reward.

See also: A USD/NOK Move That’s Been Months in the Making

Fundamental Factors Impacting USD/NOK

Given the weaker Norwegian krone over the last couple months, we may see a boost in Norway’s export industry. Another effect could also be a higher consumer price index (CPI).

In the US, it remains to be seen whether the recent government shutdown will have a harsh negative impact on economic data. Even if so, that’s likely to be a short-term drag, but it could be just the catalyst USDNOK would need to pull back and present another reasonable long-entry opportunity.

Trading Conclusion

The long-term bullish case for USDNOK remains intact, but short term, a consolidation or even a harsh, sudden pullback is possible, so patience is a virtue for the time being.

Be on the lookout for a healthy retracement to possible support levels such as 6.07 or 6.00, areas where more favorable risk/reward opportunities could be available for new long positions.

Again, there’s always a train to catch in the FX market, but we all want to travel in first-class with minimal hassle and little downside risk.

By Rafiul Hossain, Guest Analyst, DailyFX.com

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES