Comment: Investing in the forex market is a problematic undertaking. Realizing where price may move in future seems easy however escapes virtually all people. The reason for that is they will often do not keep in mind every piece of information that is available. Purely researching signals as well as forex charts just gives only half the situatiom. To obtain an edge on the market details are important and knowing how to find it is crucial. We try to bring everyone the most significant content articles to help you make smarter trading selections. This article, Norwegian Krone Forecast: EUR/NOK Exchange Rate Headed To 9.40 On A Break Of 9.52 gives you the most recent information about exactly where the professionals sense exchange rate may go giving you an opportunity to become more profitable in your forex trades
The Norwegian Krone exchange rate complex was caught a little on the back foot on Tuesday, as it lost ground against both the Euro and the Swedish Krona.
The Oil price was a little higher which would typically support the NOK, but the main issue was the strength in the SEK which put the squeeze on the Krone.
NOK/SEK has been absolutely vertical for the last month or so, which has granted the NOK breathing room against a relatively stable Euro.
Indeed, EUR/NOK had also seen three days of heavy losses, suggesting that some sort of overbought correction was possible in the Norwegian currency.
The catalyst for the move over the last few days was a better than expected inflationary reading at 2.2%, suggesting that the Norges Bank may be well on track to raise rates this year after all.
Danske Bank: Short EUR/NOK, Long NOK/SEK
The moves in the NOK have clearly indicated a good amount of demand from big investors, and the wealthy nation of Norway and its large sovereign wealth fund appears much better positioned to benefit than the more debt-laden Swedish economy, where there are concerns over a housing bubble amongst other things.
Forex strategists at Danske Bank are still bullish NOK/SEK as a result even if it looks overbought, and maintain their bearish position in EUR/NOK,
“In the Scandi sphere, the NOK keeps edging higher, with most notably NOK/SEK now seemingly breaking above 1.06. Previously, this level has triggered selling interest and, in our view, a sustainable break is a prerequisite for more NOK strength including EUR/NOK breaking below the 9.5262 support level, which should open the way for a testing of the mid- to low 9.40s. We like both the tactical and strategic arguments for being long NOK and remain short EUR/NOK and long NOK/SEK”.
Interest rates for the Eurozone remain a critical consideration for central bankers in both Norway and Sweden, with many investors skeptical they will have the appetite to “outhike” the ECB.
As it stands, however, with inflation around target in Norway, everything would appear to be in place for the Norges Bank to move before Draghi does, and hence the strength we are seeing in the NOK.
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