The British Pound strengthened against the Swedish Krona as the EU has agreed to delay the Brexit process. Last week Swedish Krona closed marginally higher against the Pound. This happened after the news that the Sweden central bank is ready to deliver a rate hike later this year. However, all Krona’s gains have been erased as we have entered a new week of trading.
Swedish Krona finished the first trading day of the week down against the British Pond. It closed the dayday at an exchange rate of 12.4809. Before the London opening session the GBP/SEK exchange rate was seen quoted higher around 12.5024.
Swedish Krona failed to maintain its gains against a much stronger British Pound. The main catalysts that motivated the bullish momentum behind the Pound were the removal of uncertainty surrounding the Brexit deadline. With only three days left before the 31 October deadline, Brussels has agreed to extend the Brexit deadline by three months until 31 January 2021.
The UK was originally set to leave the 28-nation bloc on 29 March 2019. Since then the deadline has been now for the fourth time delayed. The UK Prime Minister Boris Johnson is expected to seek a vote to trigger an early general election.
By calling a general election the UK Prime Minister is looking to win more Conservative seats to make the path for a smoother Brexit process. While the risks of a no-deal Brexit have been diminished. But there is still a possibility for the UK to leave without a deal the EU, which may disrupt the market volatility.
GBP/SEK Technical Pattern
From a technical point of view the GBP/SEK exchange rate remains trapped in an overextended trading range. On the upside the key resistance level 12.5350 keeps the bulls in check. On the downside traders should keep an eye on the previous week low established at the 12.3240 for a possible support area.
If the bullish momentum gets more traction, there should be another attempt from the GBP/SEK exchange rate to break the current 2019 high established at the 12.6149 level.