By Dan Eduard – Sweden continues to be one of the major success stories in European economics. Recently, comments from the Swedish Central Bank signaled a possible rise in interest rates in the near future. This led to fairly significant gains for the krona, particularly against the euro and US dollar. Over the last several days, the EUR/SEK pair has dropped over 1200 pips, and is currently trading around the 9.2450 level. The USD/SEK had dropped over 1000 pips late last week, but the pair managed to stage an upward rally when markets opened on Sunday night. The trend for USD/SEK is still very much bearish, and analysts do not foresee a significant upward correction in the near future.
Turning to the other Scandinavian currencies, both the NOK and DKK have not been able to match the success of its Swedish counterpart. Since markets opened for the week, the Norwegian krone has lost almost 400 pips to the euro and close to 1000 pips against the dollar. While the Danish krone has been consistently gaining against the greenback in recent months, it has started off the week loosing over 600 pips against the USD. While the EUR/DKK pair has moved relatively little this week, the pair seems locked in an upward trend which is unlikely to break in the near future.
This week, traders will want to pay attention to several economic indicators out of the US that are likely to influence the Scandinavian currencies. US Fed Chairman Bernanke is scheduled to give a speech on Wednesday and Friday. His speeches typically give a clear indication of the direction the US economy is heading and consistently lead to market volatility. Any news that the US is moving to implement quantitative easing measures in order to stave off another recession, is likely to bring the dollar down against the Scandinavian currencies.
Forex Market Analysis provided by ForexYard.
© 2006 by FxYard Ltd
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