Forex Market: GBP/NOK daily trading forecast

Yesterday’s trade saw GBP/NOK within the range of 10.3910-10.4781. The pair closed at 10.4643, gaining 0.51% on a daily basis.

At 7:08 GMT today GBP/NOK was up 0.38% for the day to trade at 10.4799. The pair touched a daily high at 10.4810 at 7:04 GMT.

Fundamentals

United Kingdom

The number of jobless claims in the United Kingdom probably dropped by 35 000 in September, according to expectations, following another drop by 37 200 in August. At the same time, the claimant count rate, which represents the percentage change of jobless claims compared to the entire work force, probably fell to 2.8% in September from 2.9% during the previous month.

The rate of unemployment in the UK, estimated in accordance with ILO (International Labour Organization) standards, probably dropped to 6.1% during the three months to August compared to the same period a year ago, from 6.2% in the three months to July. If so, this would be the lowest level since the fall of 2008.

During the period May-July there were 2.02 million unemployed people, or 146 000 fewer compared to February-April and 468 000 fewer compared to May-July 2013. This has been the most significant annual drop in unemployment since 1988. There were 30.61 million people in work, or 74 000 more compared to the period February-April 2014. This has been the smallest quarterly increase since the period April-June 2013.

In May to July there were 8.93 million people aged between 16 and 64, who were out of work and not seeking or available for employment, according to data by the Office for National Statistics (ONS). This represented an increase by 114 000 in comparison with the period February to April, but was also a fall by 31 000 compared to May-July last year.

The rate of unemployment refers to the percentage of economically active people, who are currently unemployed. According to the ILO approach, people who are considered as unemployed are either: 1) out of work, but are actively searching for employment, or 2) out of work and are waiting to be hired again during the next two weeks.

The ILO Unemployment Rate is based on a monthly survey, known as the Labour Force Survey in the United Kingdom, with approximately 40 000 individuals being interviewed every month. This indicator reflects overall economic state in the country, as there is a strong correlation between consumer spending levels and labor market conditions. Low rates of unemployment are accompanied by higher spending, which causes a favorable effect on corporate profits and also accelerates overall growth. In case the rate of unemployment fell more than projected, this would certainly have a bullish effect on the sterling. The official report by the ONS is due out at 8:30 GMT.

Norway

At 8:00 GMT Statistics Norway is to report on nations balance of trade regarding September. In August Norway had a surplus at the amount of 22.355 billion NOK, down from 22.585 billion NOK in July. Nations balance of trade produced a record high surplus of 48.270 billion NOK in January this year.

International trade accounts for almost 37% of Norway’s Gross Domestic Product. Countrys main exports include seafood, crude oil, light metals, ship equipment and maritime services, while it imports mostly machinery and equipment, chemicals, metals, and foodstuffs.

In case of contracting trade surplus in September, this would lead to a sell-off in the local currency.

Pivot Points

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 10.4445. In case GBP/NOK manages to breach the first resistance level at 10.4979, it will probably continue up to test 10.5316. In case the second key resistance is broken, the pair will probably attempt to advance to 10.5850.

If GBP/NOK manages to breach the first key support at 10.4108, it will probably continue to slide and test 10.3574. With this second key support broken, the movement to the downside will probably continue to 10.3237.

The mid-Pivot levels for today are as follows: M1 – 10.3406, M2 – 10.3841, M3 – 10.4277, M4 – 10.4712, M5 – 10.5148, M6 – 10.5583.

In weekly terms, the central pivot point is at 10.4481. The three key resistance levels are as follows: R1 – 10.5285, R2 – 10.5908, R3 – 10.6712. The three key support levels are: S1 – 10.3858, S2 – 10.3054, S3 – 10.2431.