USDSEK
USDSEK retreat for third consecutive trading session amid rising risk appetite in hopes of a coronavirus vaccine. The better economic data from the USA didn’t help the USD but rather shift investors attention to more risky assets. Ahead of the NFP data later today, investors cheered yesterday the U.S. Manufacturing PMI, which came in at 49.8, above the estimates of 49.6 in June. The Private payrolls rose by 2.369 million in June. The May ADP figures, in a big surprise, revised higher to 3.065 million from a job loss of 2.76 million. The Challenger Job Cuts came in at 170.219K in June below the previous month of 397.016K.
Riksbank in its policy meeting on July 1st kept the interest rates unchanged as was widely expected by markets but has extended the asset purchases from SEK 300 billion to SEK 500 billion up to the end of June 2021. The Riksbank will continue to purchase government bonds, and mortgage bonds as well as commercial paper. In September, the Riksbank will start buying and corporate bonds.
The central bank believes that the low-interest-rate environment creates the conditions for a recovery in the economy and will help inflation rise towards the target of 2%. The combination of appropriate measures is continuously being evaluated and will be adjusted to economic developments.
USDSEK Technical Analysis
USDSEK is 0.45% lower at 9.2622 close to daily lows making fresh two week lows. The pairs momentum is bearish since May 19 when USDSEK breached below the 200-day moving average. Bears are in full control of the pair and only a return above the 50-day moving average at 9.5335 might cancel the bearish momentum.
Traders attention is on lower levels, and the initial support for the USDSEK will be met at 9.2368 the daily low. The next support zone for the pair might emerge at 9.1639 the low from June 11. The next support stands at 9.1320 the low from June 5.
On the other hand, immediate resistance for USDSEK pair will be met at 9.3145 the daily top. A move above might attract more bulls for an attempt to the next resistance level at 9.3791 the top from July 1st trading session. The next supply zone is at 9.4742 the high from June 22.
