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Investing.com - BCA announced Friday it has initiated a tactical long USD/NOK position at market close, implementing a 2% stop loss as part of its strategy anticipating a near-term rebound in the U.S. dollar.
The investment decision comes despite the Norges Bank delivering an expected 25 basis point interest rate cut, which was accompanied by guidance that market participants viewed as surprisingly hawkish.
BCA’s European Investment Strategy team projects the Norwegian economy will weaken as 2026 approaches, potentially forcing the central bank to implement deeper rate cuts than currently anticipated by markets.
The firm’s analysis indicates the Norwegian krone has experienced a strong rally recently, pushing the currency into what BCA considers overbought territory and creating favorable conditions for the tactical position.
The USD/NOK position represents BCA’s explicit view on dollar strength against the Norwegian currency, with the defined stop loss limiting potential downside risk to 2% should the position move against expectations.
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