Forex Market: GBP/NOK daily trading forecast

Yesterday’s trade saw GBP/NOK within the range of 10.5682-10.6320. The pair closed at 10.6112, gaining 0.28% on a daily basis.

At 7:15 GMT today GBP/NOK was up 0.23% for the day to trade at 10.6350. The pair broke the first key daily resistance and touched a daily high at 10.6405 at 7:19 GMT.

Fundamentals

United Kingdom

Retail Sales

Annualized retail sales in the United Kingdom probably rose 2.8% in September, according to the median forecast by experts, after in August sales climbed 3.9%, with the latter being the fastest rate of increase since April. In monthly terms, retail sales probably dropped 0.1% during September, following a 0.4% gain in August. Annualized retail sales, without taking into account fuel sales, probably rose 3.4% in September.

This is a short-term indicator, which provides key information about consumption on a national scale. Higher retail sales suggest stronger consumer demand, confidence and economic growth, respectively. Therefore, in case the index of retail sales increased at a faster than projected pace, this would be pound positive. The Office for National Statistics is expected to publish the official report at 8:30 GMT.

Mortgage Approvals by the BBA

The number of home loans in the United Kingdom, issued by the British Bankers’ Association (BBA), probably was 41 400 in September, following a number of 41 588 in August. The BBA features the major banks in the country, which account for almost 60% of overall mortgage lending. The number of mortgage loans is considered as a leading indicator in regard to UK housing market conditions. As growth in mortgage lending signifies a healthy housing sector, which also contributes to overall economic activity, in case the number of loans came in greater than projected, this would boost demand for the sterling. The BBA is to publish the official figure at 8:30 GMT.

Industrial Orders by the CBI

The gauge of industrial orders in the United Kingdom probably remained unchanged at a reading of -4 during the three months to October, according to expectations. This indicator reflects the net balance between companies, that registered an increase in industrial orders during the respective period of three months and those, that registered a drop. It is the oldest indicator, released from the UK private sector, to show the development tendency in countrys industrial sector. The Industrial Trends Survey by the Confederation of British Industry (CBI) provides expert qualitative opinion from senior manufacturing executives, on past and expected trends in output, exports, prices, costs, investment intentions, business confidence and capacity utilization. A level above zero suggests that volume of orders is projected to increase, while a level below zero indicates that expectations point to lower volumes. If the survey showed predominant pessimism, this would have a bearish effect on the sterling. The CBI will announce the results from its survey, encompassing 17 industries, at 10:00 GMT.

Norway

Norges Bank will probably leave its key policy rate (also known as sight deposit rate) unchanged at 1.50% at its policy meeting today. The benchmark rate has been at this level since the March 15th 2012 meeting. This rate usually has a strong influence on short-term money market rates and on banks deposit and lending rates.

The main objective of Norges Banks policy is to maintain price stability and an annual inflation rate of 2.5%.

Short-term interest rates are of utmost importance for the valuation of national currencies. In case the central bank is dovish about inflationary pressure in economy and, thus, decides to maintain or even cut the benchmark interest rate, this would certainly have a bearish effect on the krone.

The official decision on policy is to be announced at 8:00 GMT.

Pivot Points

According to Binary Tribune’s daily analysis, the central pivot point for the pair is at 10.6038. In case GBP/NOK manages to breach the first resistance level at 10.6394, it will probably continue up to test 10.6676. In case the second key resistance is broken, the pair will probably attempt to advance to 10.7032.

If GBP/NOK manages to breach the first key support at 10.5756, it will probably continue to slide and test 10.5400. With this second key support broken, the movement to the downside will probably continue to 10.5118.

The mid-Pivot levels for today are as follows: M1 – 10.5259, M2 – 10.5578, M3 – 10.5897, M4 – 10.6216, M5 – 10.6535, M6 – 10.6854.

In weekly terms, the central pivot point is at 10.5347. The three key resistance levels are as follows: R1 – 10.6784, R2 – 10.8225, R3 – 10.9662. The three key support levels are: S1 – 10.3906, S2 – 10.2469, S3 – 10.1028.