Philip Salter
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THERE’s no shortage of debate as to where Santa Claus actually lives – but deep forests, plenty of snow, an abundance of reindeer and an economy that has in recent years seemed to be tinted with magic certainly makes a compelling case for Sweden. With its resource based economy, it’s perhaps no surprise that the currency has seen steady appreciation over the longer term, with dollar-Swedish krona falling from a high of SKr9.5 in March 2009, down as low as SKr6 in May of this year. 2011 has however been somewhat range-bound and the country’s ongoing economic success now seems linked to avoiding a global recession. IG Index offers SKr6.868-SKr6.872.

After Europe only managed to coup €150bn for the bailout fund, finance ministers are now relying on countries such as Sweden and Poland to put their hands in their pockets and help out. We know the situation is bad and we are in a bear market, so any rallies will be short-term bear market squeezes. The current push is off the back of good German business confidence data. Capital Spreads quotes euro-dollar at $1.3120-$1.3121.

With UK and US GDP figures released tomorrow, forex traders will be looking to take advantage of the upcoming tug-of-war between the sterling-dollar pair. The short-term technicals point towards a rally, after the pair broke above its resistance. Capital Spreads quotes a price of $1.5682-$1.5684.

The Norwegian krone finishes 2011 in almost exactly the same place as it started the year against the dollar. But this relatively flat outcome disguises quite a volatile year, with it at one point rising 10 per cent, to lows of NKr5.215, before a 15 per cent rally to highs of NKr6.00 just last week. With Norway expected to continue to benefit from inward flows in 2012 and the dollar possibly vulnerable to a pull-back, look to sell dollar-Norwegian krone around NKr6.000-NKr6.070 with a long-term target in 2012 of a return to 2011 lows around NKr5.2500. Spread Co quotes NKr5.8807-NKr5.8857.