WTI TECHS: (K5) Reversal Accelerates

Bearish momentum in NOKSEK has persisted following Monday’s notable breach of multi-year support at 0.9500. Today’s 0.7% sell-off helps narrow the gap to the next downside target at 0.9274 (November 2020 low).

• Buoyant European risk sentiment following last night’s German fiscal reform proposals have provided support to the SEK this morning. Meanwhile, soft crude oil and natural gas performance has limited tailwinds for the NOK, even as secondary home-prices significantly exceeded Norges Bank forecasts for the third consecutive month.
• Norges Bank Governor Wolden Bache delivers a lecture to Oslo University students at 1315GMT today. We expect any near-term monetary policy signals to reaffirm that a 25bp cut on March 27 is the base case, but remain watchful of any signs that the March MPR rate path is set for an upward revision.
• Tomorrow’s Swedish February flash inflation report may be a more important driver of near-term NOKSEK performance. A reversal of some of January’s strength could help an oversold condition (on a 14-day RSI basis) unwind, but rallies short of the 20-day EMA at 0.9585 will be considered corrective. 

Figure 1: NOKSEK Weekly Chart (2015 - 2025)

RXJ5 131.00/129.50/128.00 put fly 10K given at 41.5/