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Short-term Trading Idea FX USD/NOK – Bull Speculation: Rebound from Lower Limit to Upper Limit of Canal.

Trading opportunities for currency pair: a dollar rebound from the lower to the upper limit of the canal is expected. As a target zone, set out a range between 7.5431 and 7.7144. After a break through 7.5385, the dollar’s growth will hasten. It’s difficult to say when this idea will be cancelled out. However, we don’t want the rate to drop below 7.38.

The last idea I published on the USD/NOK was on 20th April. Back then I expected a break in the trend and a drop in the rate of the dollar to 7.3859 due to oil becoming more expensive. On 27th April I did an appendix to the previous review.

The dollar was trading above the trend line for 5 days and broke the trend on 27th April. The market participants started selling US dollars, fearing that, with the US economy slowing, the Federal Reserve won’t put up rates in June.

Last week the USD/NOK dropped to 7.3099. The target was reached. The Norwegian krona strengthened due to oil prices going up. On Wednesday the price of Brent crude hit 69.63 dollars following the publication of a report from the Ministry of Energy. Statistical data for last week showed a reduction in US oil reserves by 3.882 million barrels (forecasted +1.5 million barrels).

A correctional phase from the 70-dollar psychological level has started. Oil cheapened from its 69.63 maximum to 64.23 (including Friday).

On Friday some decent data on the American labor market came out. Before it came out, participants had no idea whether the data would be positive or negative. Nevertheless, the dollar rate closed Friday with a growth against the krona and closed the week with a long low tail.

Today my idea is a rebound for the dollar from the lower limit to the upper limit of the canal. The strengthening of the dollar will probably be something similar to the upward correction from the previous 7.7271 minimum of 26th March this year. As a target zone, set out a range between 7.5431 and 7.7144. After a break through 7.5385, the dollar’s growth will hasten. If the USD/NOK hits 7.6681, an inverted head and shoulders model will appear. You’ll have to watch for its formation and structure on the hourly time-period.

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Forecasts which are made in the review constitute the personal view of the author. Commentaries made do not constitute trade recommendations or guidance for working on financial markets. Alpari bears no responsibility whatsoever for any possible losses (or other forms of damage), whether direct or indirect, which may occur in case of using material published in the review.

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