USD/SEK approaches multi-month highs amid solid US economic figures

USD/SEK jumped to a high around 11.212 and then settled at around 11.180, seeing 0.35% gains.
Despite strong GDP data, US Treasury yields and hawkish bets on the Fed are declining.
All eyes are now on PCE data from September from the US on Friday.

Patricio Martín FXStreet

On Thursday, the USD/SEK gained further ground, tallying a five-day winning streak and jumping to its highest level since September 22 at 11.212. Strong data reported from the US is the main responsible for the Greenback outperforming its rivals but as US yields retreat, the upside is limited.

The U.S. Bureau of Economic Analysis reported that the Gross Domestic Product (GDP) Growth Rate preliminary estimate from Q3 came in above the consensus. It showed that the economy grew at an annualised rate of 4.9% QoQ vs the expected 4.2% and rose from its previous figure of 2.1%. On the negative side, the U.S. Department of Labor revealed that the Initial Jobless Claims from the week ending on October 21 exceeded expectations. The headline figure came in at 210,000, above the consensus of 208,000, and rose from its previous figure of 200,000.

Despite the strong GDP figures, investors focus on Jobless Claims accelerating as US Treasury yields fall. The 2,5, and 10-year yields fell towards 5.04%,4.80% and 4.84%, respectively, limiting the USD’s gains during the sessions. Another factor that could limit the pair's upward trajectory is investors betting on higher of the Federal Reserve (Fed) not hiking again in 2023. The CME FedWatch Tool suggests that the odds of a 25 basis points hike in December fell to 20% and that a pause in November is nearly priced in.

However, Personal Consumption Expenditures (PCE) from September are due on Friday, which could impact the pair’s dynamics as that metric is the Fed’s preferred inflation gauge.

USD/SEK Levels to watch

The daily chart analysis indicates a bullish outlook for the USD/SEK in the short term. The Relative Strength Index (RSI) is above its midline in positive territory, aligning with the positive signal from the Moving Average Convergence Divergence (MACD), which displays green bars, reinforcing the strong bullish sentiment. Also, the pair is above the 20,100,200-day Simple Moving Average (SMA), indicating a favourable position for the bulls in the bigger picture.

Support levels: 11.145, 11.087, 11.055.
Resistance levels: 11.200, 11.242, 11.265

USD/SEK Daily Chart

USD/SEK

Overview
Today last price	11.1803
Today Daily Change	0.0276
Today Daily Change %	0.25
Today daily open	11.1527

Trends
Daily SMA20	10.9891
Daily SMA50	11.0284
Daily SMA100	10.8354
Daily SMA200	10.6434

Levels
Previous Daily High	11.1899
Previous Daily Low	11.0875
Previous Weekly High	11.0629
Previous Weekly Low	10.8869
Previous Monthly High	11.401
Previous Monthly Low	10.7524
Daily Fibonacci 38.2%	11.1508
Daily Fibonacci 61.8%	11.1266
Daily Pivot Point S1	11.0968
Daily Pivot Point S2	11.041
Daily Pivot Point S3	10.9944
Daily Pivot Point R1	11.1992
Daily Pivot Point R2	11.2458
Daily Pivot Point R3	11.3016

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

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