EUR/NOK poised for further rangebound – Danske Bank

Senior Analyst at Danske Bank Morten Helt sees EUR/NOK in a sideline theme in the near term.

Key Quotes

“Positive sentiment in the oil market has supported NOK this week. Yesterday, the EIA reported falling US crude stocks which added further to the trend”.

“We see limited further upside near term to oil prices though and positioning is stretched long”.

“Our fundamental predisposition remains to sell EUR/NOK, but with EUR/NOK trading slightly below 9.30 we see limited further downside as we think the pair is stuck in the 9.25-9.40 range for now”.

“Instead, we prefer to position for a modest rebound in NOK/SEK selling a 3M straddle skewed to the upside”.