NOK, SEK, and DKK

[Jason Rogers]

Hi Everybody,

I've recently started following the NOK, SEK, and DKK now that fxcm has released more Krone crosses. The NOK sounds interesting due to its corelation with oil. What are some of the other important news events or characteristics you're watching with these currencies?

Does anyone actively trade these pairs? I understand the spread can get quite large outside of the active trading hours.

 

[fxmonk]

Scandinavian crosses

Look at news coming out of Eastern Europe, and also baltic countries such as Latvia. They do a lot of business with Sweden and Denmark and investment banks in SE and DK invest in risky places like those countries. What are you trading them against? EUR or USD? It makes a huge difference what you pay attention to.

Hi Everybody,

I've recently started following the NOK, SEK, and DKK now that fxcm has released more Krone crosses. The NOK sounds interesting due to its corelation with oil. What are some of the other important news events or characteristics you're watching with these currencies?

Does anyone actively trade these pairs? I understand the spread can get quite large outside of the active trading hours.

 

[NetTecture]

Before you trade any of those.... check their correlation with the EUR.

Especially:
* The DKK is in a narrow range, legally (central banks support it) to the EUR. VERY narrow. So, why trade it?
* The NOK is.... in a RELATIVELY narro range, too. From 2008 it goes from around 8 to 10 NOK / EUR, but it basically always was around 8.4, now it is around 9. I have ben doing business with Norway for many years (in fact, I still do in my other life) and we calculated with 8.5 for years, now calculating with a factor of 9. Not a lot of movement.
* The SEK is a similar story

In general, make sure the movements you are playing are not actually movements of the EUR - all those currencies are pretty well tied to the EUR.

Especially the DKK makes no sense, except in a play "it breaks out of the legal range". Just so that you understand here - the 1 year (!) range of the DKK against the EUR was basically between 7.462 and 7.442 - this is a change on the third digit ONLY (10 pips) over ONE YEAR Any play against the DKK is basically a play against the EUR, as the DKK is legally tied to the EUR in a VREY tight band - 2% or something. Pretty much no sense in trading vs. DKK You definitely did not make your homework on that one

 

[GammaJammer]

DKK moves with eur but nok and sek definitely have their own agenda. Both correlate reasonably well with the global risk story, and as stated nok has an affinity with oil, while the swedish banking industry's prominence and exposure to E. Europe makes it a good bellweather for troubles in baltic states.

However, natural liquidity is vs the EUR, so you are trading dollar sentiment in addition to all these factors if you trade usdsek and usdnok. That's fine as long as you're aware of it and comfortable with it.

 

[zuke]

Hi Everybody,

I've recently started following the NOK, SEK, and DKK now that fxcm has released more Krone crosses. The NOK sounds interesting due to its corelation with oil. What are some of the other important news events or characteristics you're watching with these currencies?

Does anyone actively trade these pairs? I understand the spread can get quite large outside of the active trading hours.

I actively trade USD/NOK and have done for quite a while. Spreads can get monstrous and volatility can be brutal. However, I have found that these trend quite nicely also.

You need pretty deep pockets and nerves of steel to trade them sometimes, but I have found them profitable

 

[GammaJammer]

Old thread - someone called petersmitty, sorry, Wasp having a cheeky dabble.

 

[Jason Rogers]

I actively trade USD/NOK and have done for quite a while. Spreads can get monstrous and volatility can be brutal. However, I have found that these trend quite nicely also.

You need pretty deep pockets and nerves of steel to trade them sometimes, but I have found them profitable

I was looking over the charts for the past two days and USD/NOK dropped 1000 pips during the London session. Yesterday’s London session saw an uptrend of nearly 800 pips. Looks like an interesting pair to trade. I'm sure it's not like that all the time.

I've also been looking for news resources. Are there any websites you watch? Ran across one article talking about NOK unemployment current at 3.3% which sounds incredibly low when you compare it with US employment at 10%+

 

[Jason Rogers]

DKK moves with eur but nok and sek definitely have their own agenda. Both correlate reasonably well with the global risk story, and as stated nok has an affinity with oil, while the swedish banking industry's prominence and exposure to E. Europe makes it a good bellweather for troubles in baltic states.

However, natural liquidity is vs the EUR, so you are trading dollar sentiment in addition to all these factors if you trade usdsek and usdnok. That's fine as long as you're aware of it and comfortable with it.

Thanks GammaJammer. Great information. I'll have to keep that in mind, and also take a look into EUR/SEK and EUR/NOK.

 

[Jason Rogers]

Look at news coming out of Eastern Europe, and also baltic countries such as Latvia. They do a lot of business with Sweden and Denmark and investment banks in SE and DK invest in risky places like those countries. What are you trading them against? EUR or USD? It makes a huge difference what you pay attention to.

Starting out watching against the USD, but from what GammaJammer is describing, may be better to watch against the EUR?

 

[Jason Rogers]

Especially the DKK makes no sense, except in a play "it breaks out of the legal range". Just so that you understand here - the 1 year (!) range of the DKK against the EUR was basically between 7.462 and 7.442 - this is a change on the third digit ONLY (10 pips) over ONE YEAR Any play against the DKK is basically a play against the EUR, as the DKK is legally tied to the EUR in a VREY tight band - 2% or something. Pretty much no sense in trading vs. DKK You definitely did not make your homework on that one

Will be hard to overcome the trading costs with only a 10 pip range for the year.

 

[Yoshie]

The USD/nok move in opposite direction of gold, the chart is basically a mirror of gold flipped on the X axis

 

[GammaJammer]

The thing to be careful of when trading usd/nok and usd/sek is that you are sometimes, in effect, basically just trading eur/usd. The reason for this is that the natural price for these currencies is eur/nok and eur/sek (as I said earlier). So usd/nok is a somewhat artificial pair. It's calculated by taking the eur/nok rate and dividing by the eur/usd rate. Same story in Sek

So if nothing at all is happening in eur/nok, and eur/usd goes nuts, usd/nok would still move. Doesn't mean anything at all happened in Norway.

Make sense?

 

[Rossini]

Iv always been interested in trading these kind of pairs. Sometimes outside of uk/us trading hours these kind of pairs wont move at all. I have always liked the idea of trading the breakout of this range. From what I have seen, good strong moves happen around 6am which makes sense.

 

[Jason Rogers]

Scandi Daily

Attached is a Scandi report that I am signed up for. You can request it to be sent to your email by emailing [email protected]. FXCM's still in the process of creating more research for the Scandinavian pairs it released, but it's a start.

 

[GammaJammer]

Attached is a Scandi report that I am signed up for. You can request it to be sent to your email by emailing [email protected]. FXCM's still in the process of creating more research for the Scandinavian pairs it released, but it's a start.

I am going to be a bit harsh here and say that I think that's a poor piece of research. Mostly comprises a few basic chart levels that you can find yourself, plus a cut and paste job of the data releases due. Nowhere in there did I find anything that made me sit up and take notice. It's what bank research was like 10 years ago. But I also have a feeling it'll go down well with the target audience. I just think even in terms of free stuff there's got to be better out there than that.....

GJ

 

[Jason Rogers]

hi GJ,

I really appreciate the feedback. Do you have a list of resources you are using to watch these pairs?

 

[GammaJammer]

Well yeah but they're basically interbank tools so they're not really widely available. Sorry dude. You're talking about pricing? research?

 

[Jason Rogers]

Well yeah but they're basically interbank tools so they're not really widely available. Sorry dude. You're talking about pricing? research?

No worries, I have access to a lot more research as well. How about some free resources that the general scandi trading community could use?

 

[GammaJammer]

Well will have a think next few day see what I can come up with