USDNOK retreat for the second consecutive day and makes another attempt to break below the 50-day moving average as the bears rejected the previous week at the critical support moving average. As crude oil rallies after hitting historically low levels, the previous week NOK is gaining momentum.
The significant events for the pair this week is Norges Bank policy meeting on Thursday. The main drivers of USDNOK are the global prospects for the reopening of the businesses and increase in crude oil demand.
The other market-moving event of the week is the Friday’s U.S. jobs data, which expected to report a loss of more than 21 million jobs and a jump in the unemployment rate to 16.5% from 4.4%.
USD is under pressure as the dismal data from the USA continues. The U.S. Services PMI slumped to 26.7 in April below the expectations of 27, and below the March reading of 39.8. The PMI Composite came in at 27, also below the expectations of 27.4.
On the other hand, the U.S. ISM Non-Manufacturing PMI came in at 41.8, topping the forecasts of 36.8 in April. The New Orders Index registered at 32.9, well below the expectations of 58.3 in April. The ISM Non-Manufacturing Employment Index registered in at 30 below the expectations of 51.6. ISM Non-Manufacturing Prices Paid came in at 55.1, above the expectations of 50.3 in April.
USDNOK trades 0.51% lower at 10.2628 as the correction from all-time highs questioned at the 50-day moving average. The technical picture is bullish as long as the USDNOK pair trades above the 50-day moving average.
On the downside, immediate support for USDNOK will be met at 10.2241 the daily low. If the USDNOK pair breaks below, the next support zone is at 10.1281 the low from April 10 trading session. Next critical level to keep an eye on the downside is at 9.6644 the 100-day moving average.
On the contrary, the first resistance stands at 10.3516 the daily high. A close above that level might challenge 10.4718 the high from yesterday’s trading session. A break above 10.4718 might target 10.5390 the high from April 28.