Kumowizard
Short

EURNOK - Still sideaway, with bearish bias

FX:EURNOK   Euro Fx/Norwegian Krone
42 11 2
Daily: Looked like, but finally couldn't close below the trendline. Some blame the drop of Oil             for keeping NOK             still moving sideaway and let it gain more power. I think it is rather the positionning, or lack of positionning what causes this annoying consolidation.
Price is still trading within a triangle. It is below the Kumo, retested Kijun Sen and the Kumo. Tenkan is still below Kijun, but both a bit flat. Future Kumo lines flat. MACD , DMI             and Slow Stoch don't give us sufficient information right now. Well, in fact they do give information: that is this mkt is not trending, but consolidating!

Important levels are: 8,2050 / 8,2600 on the top side, 8,1550 and 8,1000 on the lower side.

One more interesting observation is if during last 5 months the price action has been building a major Head and Shoulders formation? What's more, it looks like a double top within the Head! Really interesting formation I must say. On a break down from this the measured tgt             comes to ard 7,8000 - 7,8500.

I still prefer holding startegic shorts in this cross, with not yet much leverage though.
ACROFX
2 years ago
I have to agree with you regarding that EURNOK has a negativ/bearish bias in a longer term view, as we have several bearish patterns as you mentioned. Furthermore, if we look at Stochastic, its about to cross over (negative) and MACD is below 0, which supports to add short positions on spikes.

Beside, we are slowly seeing more fundamental factors supporting a stronger NOK. A lower oil price has reduced the appetite for this pair so far, but the rate difference between Europe and Norway should make this pair more attractive soon.
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Kumowizard PRO ACROFX
2 years ago
CPI release tomorrow will decide. If that comes lower, then NOK will weakn further for some more time. If CPI Is higher, that may bring a break down
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ACROFX Kumowizard
2 years ago
Indeed. CPI for September is due 10:00 CET. We believe the numbers will come in higher than market expectations, which is 2.6%. This is also Norges Banks forecast aswell.

A higher CPI is expected due lower Norwegian krone and normally this time of year we do see higher sales pushing the prices up. But as always, the X-factor is always either airfares and food prices.
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Kumowizard PRO ACROFX
2 years ago
I hope you will be right. Anyway, at the end of the day only reactive price action matters. I've been sitting in eurnok and eursek shorts for pretty long time now.
What really annoyes me is that a lot of sht ccys, like e.g. HUF trades a lot better than NOK. Well, you know, Hungary has no sht oil to drive its ccy down, but they have a huge debt instead to attract dumb money! How much better that BB- ccy is than the real one AAA, isn't it? :-) Short terms fundamentals don't matter, long term they will have to. We'll see tomorrow.
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Bumbull
2 years ago
Wow. What a jump today. Was there anything I missed fundamentally against the NOK, which caused such a depreciation against the EURO?
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Kumowizard PRO Bumbull
2 years ago
People blame the selloff in oil. What is partly true, but CAD is doing fine still... So I rather think today move was prssured by the selloff is SEK too, as Sweden had a really low CPI. Anyway, the spike two days ago was ugly too, but then it recovered its losses. Now the Kumo and the range is in danger. I stopped half of my position, waiting for new sell signals. The other half is kept as that has to be the minimum weight in my portfolio anyway.
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Bumbull Kumowizard
2 years ago
I see. The oil is low inded, but the NOK value dosn't change much because of the weak EUR/NOK cross am I mistaken? On the other hand you are totally right regarding to the SEK and these two move quite well together but I think NOK will recover much earlier than SEK which is in deeper trouble.
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Kumowizard PRO Bumbull
2 years ago
Well yes, if I have to decide I also prefer NOK in general, still better fundamentals than SEK. But it seems people don't think. They are scared of oil move so they sell NOK, on the other hand they are not (yet) scared of possible hit on Poland and Hungary due to Geman economic weakness. PLN and HUF still holds well, while NBP for example is about to cut base rate further.
Seems every ccy has some problem, AUD, NOK, SEK, GBP, etc., and USD is still preferred to buy against all.
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Kumowizard PRO Kumowizard
2 years ago
I think HUF and PLN will be hit a bit as well quite soon. What I do not know at mom wger the USD is about to move next, thats a big question.
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Bumbull Kumowizard
2 years ago
I have the same view and I am really puzzled about this situation but it will come. I beleive in much weaker CE currencies (HUF, PLN) and would not be suprised by USD/HUF at 270. The EURO is sick like hell and the EUR/NOK, EUR/AUD goes up, what a funny situation :(. On the 6th of August I sold (EUR/NOK was if I remember well at 8,34) 8,45 EUR/NOK call with KI level at 8,5 for 1 month paid 302 pips. It was a great idea. I think soon I will repeat it again :).
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Kumowizard PRO Bumbull
2 years ago
Yes, sometimes options structure are better to trade than outright, if one knows what he trades, what are the risks on the options "greeks". Trading options requires some deeper knowledge, otherwise it can be a two edged sward.
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