The British pound extended its gains against the Norwegian krone during the Asian session. This happened after EU officials agreed to delay Brexit until January 31. Even though PM Johnson won’t pull Britain out of the European Union on October 31 — his “do or die” deadline — he is not going to resign.
The Parliament rejected Johnson’s latest attempt to trigger a December general election on Monday. However, a snap election before Christmas is still on the table. Boris Johnson believes that a general election could provide him with a majority in the Parliament. And help deliver his Brexit proposals.
The new Brexit delay eased concerns among investors and pushed the Pound vs. Norwegian krone pair near the October high of 11.91. Falling oil prices for the second straight day are also weighing on the Norwegian krone. As of 7:00 a.m. London time, the GBP/NOK pair traded at 11.87.
From a technical standpoint, the 11.91 multi-month high reached on October 18 still acts as an important resistance zone for the pair. In the absence of market-moving Brexit news, it could be expected sellers to join the pair near 11.91 and push the price lower. Yesterday’s high of 11.86 also acts as a short-term resistance level for the pair.
To the downside, we look at the October 24 low of 11.69 as an important support level, followed by the May high of 11.52. The daily RSI shows slightly overbought market conditions, which may pose another risk for sterling buyers at the moment.