CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
☰
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Open account
✖

USDNOK Gapped Lower on the Open however may Remain Rangebound until Thursday

September 16, 2019 12:57 PM

USD/NOK Gapped Lower on the Open, however may Remain Rangebound until Thursday

With news of the drone attacks over the weekend on Saudi Arabia’s largest oil facility, Light Crude Oil Futures (CL) gapped high in the Sunday evening session to a high of 63.34, almost 10% higher than Friday’s close.   Prices have pulled back slightly but have yet to come close to retracing and filling the gap.

Source: Tradingview, City Index

Norway is a large exporting oil country as well.  So, it’s no surprise that the price of the Norwegian krone was stronger on the open (USD/NOK gapped lower at 8.9215).  However, unlike crude, USD/NOK has managed to come all the way back and fill the gap at 8.9860.  On a 240-minute chart, the pair is possibly forming a flag pattern, a continuation pattern which suggests a target near 8.76.

Source: Tradingview, City Index

Where can the USD/NOK go from here?  USD/NOK has been trading in a tight trading range since September 5th between 8.9129 and 9.0151.  We are likely to remain in that range as news begins to trickle out regarding who was behind the attacks. 

Source: Tradingview, City Index

Houthi, a rebel group out of Yemen, has claimed responsibility for the attacks. However, hardlines recently may be indicating the attack came from somewhere else:

“INITIAL INDICATIONS SHOW THAT ATTACK DIDN’T COME FROM YEMEN, AND WEAPONS ARE IRANIANS” – SAUDI-LED COALITION SPOKESMAN

The Norges Bank is set to meet on Thursday this week.  Expectations are for a 25bps hike to 1.50%.  As Norway will now be contributing more crude to the world economy, the language in the monetary policy statement will be important to watch.   This meeting may be the catalyst to move USD/NOK out of the range.


StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.

© City Index 2024