Nordea Recommend Long USD/NOK

Nordea have recommend going long USD/NOK with a target of NOK10.15 & a stop at NOK9.25.

• They note that "NOK is one of the most vulnerable targets should markets continue to trade the fear of lengthy second-wave lockdowns. NOK entered the March onslaught with slightly short positioning among foreigners, while it enters the second wave with foreigners being long. This is arguably worrisome, and we would not rule out NOK positioning being washed out completely in the coming weeks, if we get more and more restrictions across the European continent. Foreigners often sell NOK in Q4 and we tend to see a bit of frontrunning of the Norges Bank decision to stop buying NOK in December. If we get such a wash out of positioning, then we have two early warnings: i) It is impossible to say when it stops, ii) NOK would reach levels that makes it SUPER attractive to enter longs from 1st of January 2021."