FxWirePro: USD/NOK at 2-1/2 year peak, intra-day bias bullish
The Norwegian Krone plunged to a 2-1/2 year low, as the greenback surged after the Federal Reserve cut rates by 25 basis points as expected but tampered market expectations of a lengthy easing cycle. Moreover, the sellin…
The Norwegian Krone plunged to a 2-1/2 year low, as the greenback surged after the Federal Reserve cut rates by 25 basis points as expected but tampered market expectations of a lengthy easing cycle.
Moreover, the selling pressure around the Norwegian currency intensified after data showed manufacturing activity contracted in the month of July.
Norway's NIMA manufacturing PMI came in at 48.4 in July, below forecast of 51.1 and previous month reading of 51.4 revised.
USD/NOK trades 0.3 percent up at 8.8744, having touched a high of 8.8947 earlier, its highest since Jan 2016.
RSI is strong at 70.30 and MACD supports uptrend. Scope for further upside.
Stochs indicate crossover, a minor dip expected.
Immediate resistance is around 8.9000, and any violation above could take it till 8.9556/ 8.9936.
On the downside, support is located at 8.8436, break below could take it till 8.7864 (50% retracement of 8.6728 and 8.8947).
Recommendation: Good to buy on dips around 8.8500, with stop loss at 8.8436 and target price of 8.9556.
