- EUR/NOK approaches weekly tops above the 10.00 handle.
- NOK depreciates despite Brent crude extend gains.
- Norway Credit Indicator expanded 5.6% YoY in July.
EUR/NOK has left behind yesterday’s doji-like session and is now approaching weekly highs beyond the psychological 10.00 yardstick.
EUR/NOK looks to trade, oil
The Norwegian Krone is shedding further ground today despite the barrel of the European reference Brent crude is trading on a firm note beyond the critical $60.00 mark.
The cross is deriving extra weakness from the upside momentum in USD/NOK in response to the persistent bid tone in the buck in tandem with the lack of negative news from the US-China trade talks.
Also undermining the demand for NOK, Norway’s Credit Indicator showed domestic loan debt rose at an annualized 5.6% in July – or NOK 5.906 billion - coming down from June’s 5.7% expansion.
What to look for around NOK
Another rate hike by the Norges Bank at the September meeting appears to be losing momentum after the central bank showed some unexpected flexibility regarding the future rate path at the latest event. In the meantime, and while the Nordic economy keeps its shine intact, developments overseas, particularly those linked to the US-China trade war, could cast dark clouds on the domestic economic outlook and hurt the central bank’s perspective and undermine at the same time the bullish prospect for the Krone.
EUR/NOK significant levels
As of writing the cross is gaining 0.24% at 10.0106 and faces the next hurdle at 10.0363 (high Aug.26) seconded by 10.0459 (high Aug.15) and then 10.0972 (2019 high Aug.7). On the other hand, a break below 9.9553 (21-day SMA) would expose 9.9014 (low Aug.14) and finally 9.7814 (55-day SMA).
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