How to Play Oil's Rise Using Currencies
Oil prices are on the move again, and these strategists say the Norwegian krone will benefit.
One thing about the oil market: it's never boring. The European Union's plan to ban Iranian oil imports has produced an angry response from that country, and tensions are high in Nigeria and Iraq as well.
All this is pushing the price of oil higher, which should help the currencies of most oil-producing countries - but the Norwegian krone is especially well positioned for a rise, according to the currency strategists at Barclays Capital.
"We find that the NOK is one of the few commodity currencies that performs well versus the USD when oil prices rise (even if global equities sell off at the same time)," they wrote in a note to clients.
The strategists recommend selling the dollar against the krone, entering the trade around 5.900 with a stop at 6.000 and a target of 5.600.
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