- EUR/NOK sticks to gains near the 10.2800 mark.
- Correction lower in crude oil weighs on the krone.
- Solid support has emerged in the 10.2000 zone so far.
The Norwegian krone adds to Wednesday’s losses and motivates EUR/NOK to resume the upside and clinch 3-day highs near 10.2800 on Thursday.
EUR/NOK focused on crude oil dynamics
EUR/NOK advances for the second session in a row, as the rally in the Norwegian currency seems to have run out of steam pari passu with the deceleration of the upside momentum in crude oil prices.
In fact, prices of the European benchmark Brent crude appear consolidative near the $61.00 mark per barrel following recent tops around $61.70 (February 10), levels last seen in late January 2020.
NOK now seems to be moving within a consolidative theme following a sharp appreciation since late January, particularly after yearly lows vs. the single currency around 10.5500 on January 28.
Earlier in the week, headline consumer prices in Norway rose 1.1% MoM during January and 2.5% from a year earlier. The CPI-ATE (the Norges Bank’s preferred measure) rose 2.7% (from 3.0%). While the CPI-ATE remains above the central bank’s target, it is expected to drift lower later in the year, as the pass-through effects of the weaker krone fades away.
EUR/NOK significant levels
As of writing the cross is gaining 0.06% at 10.2589 and faces the next up barrier at 10.3255 (55-day SMA) followed by 10.4487 (55-day SMA) and then 10.5543 (2021 high Jan.28). On the downside, a breach of 10.2070 (2021 low Feb.10) would expose 10.0042 (monthly low Feb.17 2020) and finally 9.8163 (2020 low Jan.2).
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