Thursday, February 09, 2006
Long time readers might remember my interest in the technical analysis work by Nicole Elliott from Mizuho in the UK.
She was on European Closing Bell in her usual slot and had some interesting calls on some of the Nordic currencies vs. the euro.
Nicole likes the Swedish, Norwegian and Icelandic kronas all vs. the euro. She spelled out technical arguments for all three. I'm not so interested in the details of the call but am more interested in the awareness of these currencies, especially Iceland. Her favorite of the three trades is Iceland but she warned that it is a small country and currency and that at some point the big boys will pile into it and cause some distortion. The krona is in the mid 70's now and she sees it going to 68.
As I look at the chart for Sweden and Norway, the two appear to have a negative correlation so I am not sure how both of them will do well vs. the euro. To be clear her call for Sweden is just a return to an old range of price and as I understand her comments on Norway, that cross is more about a strong trading move. I will email her and see if she responds.
I think awareness of Iceland is going to continue to grow, more and more people will be talking and writing about it. I think this means the currency and the stock market will lift just from the capital inflow.
Posted by Roger Nusbaum at 6:19 AM