EUR/SEK Price Analysis: Double tops keep Krona bulls hopeful ahead of Eurozone inflation
|- EUR/SEK struggles to defend the previous day’s corrective bounce off weekly low.
- Bearish chart formation, likely disappointment from Eurozone inflation keep Krona buyers hopeful.
- Sellers need validation from 11.77, 200-SMA and EU HICP data for August.
EUR/SEK remains sidelined as buyers poke the 100-SMA hurdle heading into Thursday’s European session. In doing so, the Swedish Krona (SEK) pair edges higher around 11.85 as markets await the key Eurozone inflation data amid fears of witnessing a sooner policy pivot from the European Central Bank (ECB).
As a result, the first readings of the Eurozone Consumer Price Index (CPI) for August will join the ECB’s favorite inflation gauge, namely the Harmonized Index of Consumer Prices (HICP), to direct intraday moves of the EUR/SEK pair.
Given the recent challenges for the global central bankers, a surprise positive in the inflation numbers may allow the EUR/SEK to cross the immediate 100-SMA hurdle of 11.85.
Following that, a seven-week-old previous support line surrounding 11.93 and the double tops around 11.96 will test the Swedish Krona (SEK) sellers before directing them to the 12.00 threshold.
On the flip side, a clear break of the previous weekly low surrounding 11.77 will confirm the “double tops” bearish chart formation suggesting the theoretical slump toward 11.58. However, the 200-SMA level of around 11.71 may act as an intermediate halt during the theoretically expected fall.
EUR/SEK: Four-hour chart
Trend: Further downside expected
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