EUR/SEK a test of 10.40 could be a selling opportunity – Danske Bank

Allan von Mehren, Chief Analyst at Danske Bank, sees a test of 10.40 as an opportunity to short EUR/SEK.

Key Quotes

“For SEK, both monetary and government policy is in focus”.

“Today, Löfven (Social Democrats) is supposed to give an initial report to the speaker regarding his effort to form a government and when Kristersson (Moderates) finally threw the towel in, EUR/SEK jumped 3-4 figures”.

“However, should EUR/SEK recoil upwards towards 10.40, it might prove a good opportunity for entering shorts. Indeed, the key event this week is the Riksbank meeting on Wednesday, where we would not be surprised if it now signals a higher probability of a December hike”.