FOREXYARD: Forex News Blog | |
- USD/SEK’s Bearish Momentum
- Swedish Krona Reaches 10-yr High vs. EUR
- EUR Sees Bullish Movement against Kroner
- Kroner Remains Bearish Against USD
- Positive Data Causes the Kroner to Move Up against Dollar
- EUR/SEK Bullish Reversal On The Horizon
- Irish Debt Crisis Leads to Big Gains for Krona
- Scandinavian Kroner Continues to Make Gains on Dollar and Euro
- NOK Vulnerable to European Debt Concerns
- Denmark May Raise Rates; Swedish Krona in Decline
| Posted: 01 Feb 2011 03:31 AM PST
As we can see from the chart below (provided by ForexYard), the USD/SEK has been trading within a major downtrend for some time now. The current reading has pushed below the Sept. 2009 price, making this a 2-year low price mark. Moreover, as we can see from the Relative Strength Index (RSI) the price remains in neutral territory and does not show any accumulation of technical pressure to the upside. The Stochastic (slow) on our weekly chart, however, does reveal what appears to be an impending bullish cross. There appears to be several days or weeks before this cross occurs, on the other hand, which means the bearish momentum remains dominant for the time being. Technical analysts have said they expect some level of retracement in the USD/SEK towards 6.5000 by mid-February, likely assisted by a boost to the USD from Valentine's Day retail sales growth. The peaking SEK values are also expected to start cutting into corporate profits in Sweden over the next several months and at least a few forecasts are beginning to reflect this expected shrinkage. For the moment, however, traders may expect a continuation of bearishness in the USD/SEK as the pair seems to retain solid downward momentum heading into the first week of February. USD/SEK – Weekly Chart |
| Swedish Krona Reaches 10-yr High vs. EUR Posted: 01 Feb 2011 03:30 AM PST
The Swedish economy has been outperforming many of its regional neighbors over the past few years and traders are beginning to see a signal that its currency is breaking barriers. The krona (SEK) touched a 2-year high against the US dollar (USD) yesterday, a high of 6.3886. As a recent safe-haven away from the sovereign debt crisis of the euro zone, the SEK also pushed towards a 10-year high against the euro (EUR), reaching 8.7830 before bouncing back to its recent price near 8.8200. Sweden's relative growth was highlighted by December's trade surplus figures, revealing an expansion beyond the expected 7.9B SEK to a whopping 10.9B SEK. Growth in Sweden's large telecom industry, with Ericsson leading the way, helped boost Swedish exports and drive the trade surplus to this December reading. Swedish fashion retailer H&M, however, experienced a mild dip in Q4 profits, but announced its plans to open another 250 stores in fiscal 2011, citing market optimism. The stronger SEK has begun to gouge Sweden's retail industry by increasing the price of domestic goods, but the impact has so far not been dire enough to dampen Sweden's economic growth forecasts. |
| EUR Sees Bullish Movement against Kroner Posted: 18 Jan 2011 03:35 AM PST
Following the successful euro-zone debt auction last week, the EUR was able to finally break out of its downward spiral against the Scandinavian currencies. After falling more than 900 pips late last week, the EUR/SEK has since rebounded and is trading once again at around the 8.9170 level. The EUR/NOK managed to go up more than 1000 pips over the last week and is currently trading around the 7.8055 level. Despite the bullish movement the euro saw over the last week, analysts are warning traders about becoming overconfident in the currency. There are still plenty of unknowns that could sink the EU back into crisis. Both Sweden and Norway have become an alternative investment for investors who are otherwise averse to investing in the debt ridden euro-zone. As such, Scandinavian traders will want to pay close attention to any negative news in the week ahead that could potentially lead to a rebound for the kroner. Against the USD, the kroner were able to fair substantially better. This was largely due to negative US employment data which has led to a renewal of doubt in the US economic recovery. The USD/SEK has fallen more than 2300 pips in the last week, and is currently trading at the 6.6570 level. The USD/DKK has tumbled more than 2000 pips in the same amount of time, and currently stands at the 5.5640 level. This week, kroner traders will want to follow the latest US unemployment claims set to be released on Thursday. Should the figure come in below its forecasted level of 423K, a bullish reversal for both the USD/SEK and USD/DKK pairs could occur. |
| Kroner Remains Bearish Against USD Posted: 11 Jan 2011 03:30 AM PST
2011 has seen a series of positive fundamental indicators out of the US that have boosted the greenback against most of its main currency rivals, including the Scandinavian kroner. As the employment and manufacturing sectors in the United States have steadily been improving, confidence in the dollar has rebounded. In the last week alone, the USD/DKK has gone up more than 2000 pips, while the USD/NOK and USD/SEK have both increased close to 1900 pips. Against the euro, the kroner have had significantly better luck. Renewed euro-zone debt worries, this time out of Portugal, have caused the 17-nation common currency to tumble over the last week. Investor concerns with the euro-zone combined with the generally positive data out of the US have led to a fairly bleak picture for the euro. Both the Norwegian and Swedish currencies have capitalized on the euro-zone debt issues, and have gone up around 1000 pips against the troubled currency in the last week. Turning to the rest of the week, traders will want to pay attention to the main publications out of the US, including the latest Unemployment Claims figure and Retail Sales report. Early forecasts are calling for slight improvements in both indicators. If the predictions are true, traders can expect the kroner to maintain its current bearish trend against the US currency. With regards to the euro, kroner traders will want to keep up with the latest news regarding Portugal and any possible bailout if may receive. Any positive news out of the euro-zone is likely to be to the detriment of the kroner. |
| Positive Data Causes the Kroner to Move Up against Dollar Posted: 04 Jan 2011 03:14 AM PST
As we start off the new year, we see that the Scandinavian kroner continues to make gains against the US dollar as positive fundamental indicators have boosted confidence in the global economic recovery. While the Scandinavian currencies have also moved up vs. the euro, the gains have been slightly more muted due to the 16-nation currency’s appeal to risk taking investors. Positive US employment data released last week has actually weakened the dollar against the kroner, as investors abandoned the safe haven greenback. The last week has seen the USD/NOK and USD/DKK pairs fall close to 1300 pips. Meanwhile, the USD/SEK has tumbled some 1500 pips. Against the euro, none of the Scandinavian currencies have managed to gain more than 500 pips over the last seven days. This week, traders can anticipate heavy volatility among the Scandinavian pairs ahead of the release of this month’s US Non-Farm Payrolls figure. The Non-Farm indicator is widely considered the most significant economic event of the month, and heavy market activity is expected. Should the payrolls number come in above analyst predictions, traders can expect the kroner to extend its bullish trend against the dollar. At the same time, a positive Non-Farm’s figure is likely to increase demand for the euro, causing the kroner to drop against its euro-zone counterpart. |
| EUR/SEK Bullish Reversal On The Horizon Posted: 21 Dec 2010 03:49 AM PST
With some exceptions, the EUR/SEK pair has been in a continuous downward spiral for the last few weeks, dropping over 1900 pips. Technical indicators are now showing that a bullish correction may occur in the near future. This presents Forexyard traders with an excellent opportunity to enter into buy positions at a great starting price. We will be analyzing the daily chart for EUR/SEK, provided by Forexyard. The technical indicators being looked at are the Relative Strength Index, Stochastic Slow and Williams Percent Range. 1. As can be seen, the Relative Strength Index is currently floating right above oversold territory. Should the indicator cross the lower support line, it would be a clear sign that the pair may stage a reversal. 2. A bullish cross has formed on the Stochastic Slow, in a clear sign that the pair is oversold. This further supports our theory that an upward correction is likely to take place soon. 3. The Williams Percent Range is currently right around the -80 level. Typically, anything below -80 indicates that the pair is in the oversold region, and that an upward correction is imminent.
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| Irish Debt Crisis Leads to Big Gains for Krona Posted: 21 Dec 2010 03:39 AM PST
Investor fears that the euro-zone will be unable to successfully combat the Irish debt crisis have caused the euro to tumble against all of its main currency rivals, including the Scandinavian kroner. While the ECB has laid out a broad plan to combat Irish debt, strong obstacles remain before any action can be taken. Monetary policy within the Scandinavian countries has also contributed to the krona’s bullish run. Sweden recently signaled it was raising a key interest rate, causing the SEK to spike in value. In the last week, the EUR/SEK pair has tumbled close to 1500 pips. In addition, Norway’s central bank has signaled that its plan to raise interest rates as soon as this summer has not changed, leading to a jump for the NOK. In the last week, the EUR/NOK pair has fallen close to 600 pips. Currently the pairs are trading at 8.9805 and 7.8624, respectively. The next week may hold further gains for the krona, as the Christmas and New Years holidays are likely to lead to a low volatility situation in the marketplace. With little significant fundamental news on the horizon, investors are unlikely to return to risk taking in the near future. Scandinavian traders can bet that the krona will continue its current trend, at least until the ECB comes up with a more focused plan for debt relief. |
| Scandinavian Kroner Continues to Make Gains on Dollar and Euro Posted: 07 Dec 2010 06:53 AM PST
The Scandinavian kroner saw an overwhelmingly positive week, as the combination of poor US employment data and euro-zone debt worries drove up the currencies. The latest US Non-Farm Employment Change figure, which came in well below expectations when it was released last Friday, continues to affect the already weak dollar. In addition, Irish debt concerns are weighing down on the euro. Meanwhile, Scandinavian countries like Sweden and Norway, which have economies that are largely export based, have consistently been seen as having solid economies that are safe for investors to go to. The EUR/SEK pair has fallen over 1500 pips since November 29th, and is currently trading around the 9.1048 level. The greenback has fared considerably worse against the Swedish currency, dropping close to 2400 pips in the same amount of time. The NOK has seen similar gains, moving up 2500 pips against the USD and 1800 pips against the euro. As for the week ahead, traders will want to pay careful attention to any news out of the euro-zone regarding Irish debt relief. The ECB is frantically working on a set of austerity measures for Ireland, which if passed, are likely to provide some relief for the currency. The USD on the other hand will likely only see gains, if the US employment situation improves. |
| NOK Vulnerable to European Debt Concerns Posted: 15 Nov 2010 11:29 PM PST
The pressure being placed on Ireland to accept a bailout of its financial institutions has been weighing on risk appetite throughout the region. Traders appear weary of taking on too much risk, which has pulled funds away from the higher yielding assets. One result has been a weakening Norwegian krone (NOK). Norway's central bank remarked on October 26 that it would be waiting until mid-2011 to continue its monetary tightening policies. The dovish statement made clear that Norway was awaiting further recovery in other economies before attempting to expand more aggressively. As a result, the NOK has become vulnerable to risk aversion, which appears to have spiked in recent weeks. Meanwhile, Sweden's krona (SEK) is expected to gain from this influx of risk aversion. Analysts are forecasting a rise in capital inflows over the next few months for Sweden as its hawkish bank statements and monetary tightening appear to increase its appeal. The SEK has, in fact, been the second highest performing currency in 2010, only slightly behind the Australian dollar. USD/NOK Breaches Resistance at 5.9825 The current price of the USD/NOK around the 5.9965 level shows a price which has recently breached the significant 38.2% Fibonacci retracement line. On the chart below, we can see that the MACD and RSI both show additional room for upward mobility since neither has yet entered their respective over-bought regions. As with the above analysis, if pressure continues to mount throughout Europe due to Irish debt concerns, risk aversion will likely continue to loom large. With the current stance of Norgesbank, the NOK is open to downward pressure from the fundamental side. We can also see that the pair has yet to meet any significant resistance on the technical side, and appears to have the momentum to continue towards 6.1500, indicated by the 50% Fibonacci retracement line. USD/NOK – Daily Chart |
| Denmark May Raise Rates; Swedish Krona in Decline Posted: 09 Nov 2010 10:59 AM PST
The liquidity exit of the European Central Bank (ECB) may soon drive regional rates higher than Denmark's and subsequently dampen demand for the Danish krone (DKK). Despite their dependence on euro zone credit, Ireland, Greece, and Portugal may find themselves without ECB-added liquidity as the euro zone appears committed to its plans to withdraw emergency funds. The differential between euro-area interest rates and Denmark's interbank rates has begun to turn negative, leading to a higher probability of a rate increase in next month's meeting by Denmark's Nationalbanken. In Sweden, a moderate dip in the krona (SEK) was caused by USD profit-taking following the announcement of the US quantitative easing program (QE2). The USD/SEK rose almost 3.6% in the days following the announcement, and has since remained stable near the 6.7250 level. Sweden also appears poised to raise rates once more in the near future, but dovish statements from the Riksbank following the last rate change have speculators uncertain. USD/DKK Range-Trading The chart below is the USD/DKK daily chart provided by ForexYard. The pair appears to be range-trading between 5.2300 and 5.4270, represented by the 23.6% and 38.2% Fibonacci retracement levels, respectively. The pair appears to be approaching the upper border of its range-trading behavior and indicators are beginning to show impending downward pressure. The Stochastic (slow) on the chart below has what appears to be an impending bearish cross. After completing the cross, the pair is likely to experience growing sell pressure. The RSI has the price in an ascending pattern which suggests the pair has room to go higher. Once it reaches the over-bought region it will support the notion of going short on the pair. USD/DKK – Daily Chart |
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