- In my daily US dollar against Norwegian Krone analysis, it’s easy to see that the US dollar has really taken off a bit during the session on Thursday.
- The 10.72 level is an area that had been significant resistance previously, and it now has acted as support after the initial breakout and then pullback.
- This is classic technical analysis, so it’ll be interesting to see if there is follow through.
I think at this point in time, we likely would go looking to the 10.85 level and then possibly the 11 level after that. The 50 day EMA sits underneath, and it is starting to rally at this point in time. And therefore, I think you’ve got the possibility of technical support coming back into this area yet again.
Technical Analysis
From the initial sell-off, we had pulled back to the 61.8% Fibonacci retracement level, and that has held true. So, with this, one would assume that we probably go looking to the complete recovery, meaning that this pair could go as high as 11.15 above. Keep in mind that the Norwegian Krone is affected quite a bit highly by oil, but the US produces quite a bit of oil these days as well, so that may negate itself in this situation. Simply put, this is probably a market that you are just simply going to follow the momentum, and right now it looks like that momentum is most certainly to the upside, so I have no interest whatsoever in shorting this pair anytime soon.
All of this being said, I think there is a possible opportunity here. This market tends to be a bit of a creep along situation. This is a pair that is a bit choppy under the best of circumstances, but I think at this point in time the market still has a potentially positive tone. At this time, I have no real interest in shorting the USD overall, and certainly not against a smaller currency like this one.
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