Forex Strategy: Stay Short EUR/SEK and GBP/USD
I sold EURSEK at 8.7315 on December 19 expecting Risksbank to keep rates on hold while the ECB begins easing in 2013 as recession lingers while falling bond yields mark policy transmission normalization. I added to the position last week at 8.6409 as the corrective rebound launched in early January faltered and prices turned lower anew. I am initially aiming for the 8.4994-8.5054 area from here. A stop-loss on the cumulative position has been set to trigger on a daily close above 8.6942.
I have also sold GBPUSD at 1.5662 as prices broke multi-year rising trend line support set from mid-January 2009, hinting a major bearish reversal is in progress. I am initially targeting 1.5440 and ultimately aiming for major horizontal support at 1.5296. A stop-loss will be activated on a daily close above 1.5878.
--- Written by Ilya Spivak, Currency Strategist for Dailyfx.com
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