Forex Market: USD/NOK daily forecast

During Friday’s trading session USD/NOK traded within the range of 6.1207-6.1545 and closed at 6.1276.

At 7:12 GMT today USD/NOK was gaining 0.10% for the day to trade at 6.1339. The pair touched a daily high at 6.1348 at 7:14 GMT.

Fundamental view

United States

The Chicago Purchasing Managers Index (PMI) probably slowed down to a reading of 63.0 in June from 65.5 during the prior month. The index reflects business conditions in regions manufacturing sector and is interrelated with the Manufacturing Index, published by the Institute for Supply Management (ISM). A reading above the key level of 50.0 is indicative of expansion in manufacturing activity. In case the PMI exceeded forecasts, this would heighten the appeal of the US dollar. The MNI Deutche Börse Group will release the official reading of the Chicago barometer at 13:45 GMT on Monday.

The index of pending home sales in the United States probably surged 1.2% during May compared to April, according to the median estimate by experts, following another 0.4% increase in April compared to March.

When a sales contract is accepted for a property, it is recorded as a pending home sale. As an indicator the index provides information on the number of future home sales, which are in the pipeline. It gathers data from real estate agents and brokers at the point of a sale of contract and is currently the most accurate indicator regarding US housing sector. It samples over 20% of the market. In addition, over 80% of pending house sales are converted to actual home sales within 2 or 3 months. Therefore, this index has a predictive value about actual home sales.

Although there are some cancellations, there are not enough for the data to be skewed one way or another. The base value of the index is equal to 100, while the base year is 2001, when there has been a high level of home sales. The National Association of Realtor’s (NAR) will release the official index value at 14:00 GMT on Monday. In case pending home sales increased more than anticipated, this would have a bullish effect on the greenback.

Norway

Retail sales index in Norway probably dropped 0.5% in May compared to a month ago, according to the median estimate by experts, after in April compared to March sales increased 0.5%. Annualized retail sales rose 3.4% in April. This indicator reflects the change in the total value of inflation-adjusted sales by retailers in the country and provides key information regarding consumer spending trend, while the latter is a major driving force behind economic growth. The index encompasses a sample of over 13 200 items, which are included in the VAT register of the country. Sales of motor vehicles and fuel, office equipment, wood etc. are also included, in case these items are directly sold to end consumers. If the index of retail sales showed a better-than-expected performance, this would have a bullish effect on the krone. Statistics Norway is to release the official report at 8:00 GMT.

Technical view

According to Binary Tribune’s daily analysis, in case USD/NOK manages to breach the first resistance level at 6.1478, it will probably continue up to test 6.1681. In case the second key resistance is broken, the pair will probably attempt to advance to 6.1816.

If USD/NOK manages to breach the first key support at 6.1140, it will probably continue to slide and test 6.1005. With this second key support broken, the movement to the downside will probably continue to 6.0802.