USDNOK Back in Bull Channel
Following the false downside break of the bull channel off YTD lows, USDNOK has since traded back up into the middle of the channel and is currently holding within a contracting triangle pattern. The pattern has formed around the latest test of the 9.1112 level and, while MACD and RSI are turned lower for now, the focus is on an eventual break higher towards the .94193 level, in line with the broader bull trend. Currently, the retail market is around 60% long which we will need to see shift before an upside break can develop.
Keep An Eye On
With a light data sheet ahead of Christmas, the key focus this week will be on risk sentiment and developments within the COVID backdrop. If risk sentiment continues to deteriorate, potentially around news of fresh restrictions being added in places, this is likely to weigh on oil prices, which will pull NOK lower, creating room for a continuation higher in the pair. US Core PCE on Thursday will be key to watch also. A solid print will further sharpen the focus on Fed tightening expectations, keeping USD in demand as we head into the end of the year.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.