steve.jarvis's picture

Not out of the woods yet, but at last some encouraging signs for the Norwegian Kroner

The Norwegian Kroner (NOK) has been at or near the bottom of my medium-term rankings for more than 4 months.  Since sliding to an extreme low (against all but the Swiss Franc (CHF)) in late December, it has enjoyed a broad recovery and in some cases has regained both the 22 day (1 month) and 65 day (3 month) moving averages.  However, only against the Swedish Kroner (SEK) is it not still below its falling 260 day (1 year) moving average, warning that the major trend for the NOK does still remain down, with the risk of a return to underlying weakness in the weeks and months ahead.

Indeed, there are early signs on several of the NOK charts of a loss of recovery momentum and this could trigger a quite sizeable retrace of the 2 month bounce.  However, the MACD indicator (which we use in conjunction with the moving averages) is starting to look structurally sound against the EUR, CAD, AUD, NZD & SEK, suggesting that fresh NOK losses may be short-lived with a medium-term bottom being in the process of forming.  Last December's lows against these five currencies may remain intact on renewed short-term weakness, but there remains the risk of a breakdown to yet new lows against the USD, GBP & JPY which (if you ignore the CHF) remain the strongest trending Currencies according to my analysis.

To try and make the NOK story clearer, the 9 charts below are all shown from a NOK perspective (IE a rising rate = a rising NOK), even though this is not the way most of them are most commonly quoted for those wishing to trade individual pairs.

Top charts (left to right) NOK/USD, NOK/EUR, NOK/GBP

 

 

 

 

 

Middle charts (left to right) NOK/JPY, NOK/CHF, NOK/CAD

 

 

 

 

 

Bottom charts (left to right) NOK/AUD, NOK/NZD, NOK/SEK

 

 

 

 

 

 

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