Allan von Mehren, Chief Analyst at Danske Bank, sees a test of 10.40 as an opportunity to short EUR/SEK.
“For SEK, both monetary and government policy is in focus”.
“Today, LÃ¶fven (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”.