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 break below 8.4994 exposes the 8.4150-4297 area. A stop-loss on the cumulative position has been set to trigger on a daily close above 8.6942.
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I have also sold GBPUSD at 1.5662. Prices have turned lower anew after a brief recovery and I will continue to hold short. 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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