With news of the drone attacks over the weekend on Saudi Arabia’s largest oil facility, Light Crude Oil Futures (CL) gapped high in the Sunday evening session to a high of 63.34, almost 10% higher than Friday’s close. Prices have pulled back slightly but have yet to come close to retracing and filling the gap.
Source: Tradingview, FOREX.com
Norway is a large exporting oil country as well. So, it’s no surprise that the price of the Norwegian krone was stronger on the open (USD/NOK gapped lower at 8.9215). However, unlike crude, USD/NOK has managed to come all the way back and fill the gap at 8.9860. On a 240-minute chart, the pair is possibly forming a flag pattern, a continuation pattern which suggests a target near 8.76.
Source: Tradingview, FOREX.COM
Where can the USD/NOK go from here? USD/NOK has been trading in a tight trading range since September 5th between 8.9129 and 9.0151. We are likely to remain in that range as news begins to trickle out regarding who was behind the attacks.
Source: Tradingview, FOREX.com
Houthi, a rebel group out of Yemen, has claimed responsibility for the attacks. However, hardlines recently may be indicating the attack came from somewhere else:
“INITIAL INDICATIONS SHOW THAT ATTACK DIDN’T COME FROM YEMEN, AND WEAPONS ARE IRANIANS” – SAUDI-LED COALITION SPOKESMAN
The Norges Bank is set to meet on Thursday this week. Expectations are for a 25bps hike to 1.50%. As Norway will now be contributing more crude to the world economy, the language in the monetary policy statement will be important to watch. This meeting may be the catalyst to move USD/NOK out of the range.
Risk Warning Notice Foreign Exchange and CFD trading are high risk and not suitable for everyone. You should carefully consider your investment objectives, level of experience and risk appetite before making a decision to trade with us. Most importantly, do not invest money you cannot afford to lose. There is considerable exposure to risk in any off-exchange transaction, including, but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of the markets that you are trading. Margin and leverage To open a leveraged CFD or forex trade you will need to deposit money with us as margin. Margin is typically a relatively small proportion of the overall contract value. For example a contract trading on leverage of 100:1 will require margin of just 1% of the contract value. This means that a small price movement in the underlying will result in large movement in the value of your trade – this can work in your favour, or result in substantial losses. Your may lose your initial deposit and be required to deposit additional margin in order to maintain your position. If you fail to meet any margin requirement your position will be liquidated and you will be responsible for any resulting losses.
Recommended Content
Editors’ Picks
AUD/USD posts gain, yet dive below 0.6500 amid Aussie CPI, ahead of US GDP
The Aussie Dollar finished Wednesday’s session with decent gains of 0.15% against the US Dollar, yet it retreated from weekly highs of 0.6529, which it hit after a hotter-than-expected inflation report. As the Asian session begins, the AUD/USD trades around 0.6495.
USD/JPY finds its highest bids since 1990, approaches 156.00
USD/JPY broke into its highest chart territory since June of 1990 on Wednesday, peaking near 155.40 for the first time in 34 years as the Japanese Yen continues to tumble across the broad FX market.
Gold stays firm amid higher US yields as traders await US GDP data
Gold recovers from recent losses, buoyed by market interest despite a stronger US Dollar and higher US Treasury yields. De-escalation of Middle East tensions contributed to increased market stability, denting the appetite for Gold buying.
Ethereum suffers slight pullback, Hong Kong spot ETH ETFs to begin trading on April 30
Ethereum suffered a brief decline on Wednesday afternoon despite increased accumulation from whales. This follows Ethereum restaking protocol Renzo restaked ETH crashing from its 1:1 peg with ETH and increased activities surrounding spot Ethereum ETFs.
Dow Jones Industrial Average hesitates on Wednesday as markets wait for key US data
The DJIA stumbled on Wednesday, falling from recent highs near 38,550.00 as investors ease off of Tuesday’s risk appetite. The index recovered as US data continues to vex financial markets that remain overwhelmingly focused on rate cuts from the US Fed.