ALB Limited 17.11.2020
Swedish Krona The best performing G10 currency in the year to date
The Swedish krona has become the best-performing G10 currency in the year to date. It is up 8.07% against the U.S. dollar, trading 8.67 to the U.S. currency. The Swedish krona has outperformed the Bloomberg Dollar Spot Index by 10.76 percentage points.According to Nordea economist, Torbjorn Isaksson: ‘The service sector is more resilient than we thought. We, like the Riksbank, had expected GDP to fall by 10% in the second quarter, but now it looks to be better than that.
Technical View: Testing major support at 8.60, it will be hard for the pair to break below this level as the buyer seems to take charge. Back in August’20, we have seen a consolidation around this region. It will be fair to say that USD/SEK might change its course after a long downward trend started in Mar’20. A confirmation would only be on the table if the pair breaks above the significant resistance at 8.80, which would signal a break in the downward trendline. Now I have a neutral bias on the pair until it breaks below 8.60 convincingly. On the contrary, if the price action suggests another bounce from the current level, a target at 9.2850 looks good with both the 200DMA & 38.20% Fib coinciding at that level so that we might find some resistance at those price levels.
Please keep in mind the Sveriges Riksbank will be publishing its Monetary Policy Report along with the Rate decision next Thursday, so any major moves before that are unlikely.
