Norges Bank slows krone purchases: Can USD/NOK break kr9.8321 resistance?

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US Dollar vs Norwegian Krone up 1.95%

Highlights

Norges Bank's krone purchases in Q2 slowed to the lowest since intervention resumed, easing central bank demand in FX markets.
Increased energy-related inflows are reducing the need for immediate currency market operations, pressuring USD/NOK sentiment in the short term.
Technical structure is bullish, with USD/NOK expected to trade between kr9.6061 and kr9.8321 in the next 2–3 days.

Reduced krone buying and energy inflows shift FX supply dynamics

Norges Bank’s purchases of Norwegian krone during the second quarter slowed to the lowest levels since the resumption of interventions a year ago, according to Tradingpedia. This reduction in central bank demand alters liquidity conditions in the FX market, influencing supply dynamics for the krone. Meanwhile, rising energy receipts have further reduced the need for currency market operations, shaping short-term sentiment for US Dollar vs Norwegian Krone.

Technical strength persists as buyers dominate but momentum diverges

On the technical front, USD/NOK is trading above the MA-20 at kr9.5961 and MA-50 at kr9.6065 on the hourly chart, with the daily MA-200 also below price at kr9.6363. The Ichimoku Kijun on the daily chart provides immediate support at kr9.6004. Momentum indicators support the constructive backdrop, as RSI stands at 55.75 (Buy), MACD and ADX both signal Buy, and CCI as well as Bull/Bear Power point to buyer dominance. However, Stoch RSI and the Awesome Oscillator are neutral, suggesting some divergence among short-term oscillators. A negative gap of 0.0277 was observed, though price remains near the daily high in a low-volatility session.

Sideways range anticipated as volatility and breakout risk persist

In the coming 22 days, USD/NOK is expected to consolidate within a price range of kr9.6061 to kr9.8321, reflecting typical volatility around current levels. There is a 58% probability of further upside, while downside risk is contained at 42%. The baseline scenario is sideways movement within this band, though a break above kr9.8321 would open the way for a bullish extension, while a decisive fall below kr9.6061 would signal a bearish scenario.

Viktoras Karapetjanc, analyst at Traders Union, notes that reduced Norges Bank krone purchases and strong energy receipts are key macro factors in the recent USD/NOK move. He sees short-term price action supported by improving fundamentals and rising confidence in the pair as intervention pressures ease. The analyst believes these positive background dynamics could underpin further upside, though consolidation is likely near term. "I remain constructive on USD/NOK in this environment, as the interplay of lighter central bank action and resilient energy flows bodes well for buyer sentiment," says Karapetjanc.

Earlier, analysts noted that the US Dollar vs Norwegian Krone was experiencing persistent bearish momentum amid oversold signals and seller dominance. The current reversal in market dynamics, underpinned by stronger buying signals and support from shifting liquidity conditions, positions kr9.8321 as a critical threshold for potential further gains in the near term.

Source of Data: USD Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.