Following the appreciation of the Euro versus the USD, the pair is close to fair value. That means the opportunity in USD/NOK has diminished.

I expressed a positive view on the NOK rather than via Euro because of the better savings and growth prospects in the Norwegian economy. It USD/NOK seemed a safer trade than EUR/USD.

With the EUR/USD have moved back to fair value, USD/NOK has also reached my zone of indifference.

For some reason, the US equity market seems willing to ignore weaker US (and global) growth prospects (possibly because QE2 is perceived as equity market friendly, despite a signal that the US is entering a moribund growth decade).

A weakening in the equity market might result in a stronger USD - odd how this might be economically, but it seems to be the case when risk appetite weakness, possible because the USD is a funding currency for risk trades (according to some?).

I retain the GBP/NOK position.

Removed USD/NOK is two moves (on 2nd and 3rd August) at 6.00. Initial position established 20th May 2010 at 6.45.