GFT Daily Market Commentary
The dollar made the expected upmove on Thursday, even though it encountered mild weakness early in the day. The European, commodity currencies and the yen remain under pressure amid long liquidation. The dollar could march higher today as well, but some profit taking is possible ahead of the weekend.
Euro/dollar
The euro/dollar fell sharply on Thursday after ECB President Trichet flip-flopped through his statement before finally suggesting concern about weakening Eurozone growth. The pair closed at a five-month low and is at a crucial point; a close below 1.5316 would suggest the start of a double top targeting the 1.4600 area, while a failure would signal profit taking on shorts. Tough call, but the early bias is lower.
Initial support now comes at 1.5319. Further support remains at 1.5305 and 1.5240. Distant support now moved to 1.5050.
Immediate resistance is at 1.54050. This is followed by 1.5450 and 1.5515. Above the strong level at 1.5580, distant resistance moved down to 1.5630l. Oscillators are declining.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen consolidated on Thursday after nailing a seven-month high on Wednesday, but the uptrend remains in place. Again, the upside is only slightly favored today and an initial pull back is likely.
Support is at 109.15 from a 50-point pivot, which targets 109.65 and 108.65. Distant support follows at 107.95 from a 50-point pivot, which targets 107.45 and 108.45. Immediate resistance remains at 109.65. Strong resistance is at 110.60. The next resistance is at 111.00. Distant resistance is at 112.05.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar reversed early gains to slide for a fifth consecutive day on Thursday and closed below a trendline support at 1.9488. Once again, following an early bounce, the pound should see more weakness.
Immediate support is now seen at 1.9410. This is followed by 1.9365. Distant support is now seen at 1.9175. Initial resistance now comes at 1.9490. The next level is 1.9585. Above 1.9630, the next significant level is pegged at 1.9760. Oscillators are falling.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss rallied further to a new high for the uptrend on Thursday. Again, following some pullback, the uptrend should resume.
Initial support is still seen at 1.0560. This is followed by 1.0480, 1.0435 and 1.0405. Distant support now comes at 1.0370.
Above 1.0638, resistance remains at 1.0675. This is followed by 1.0790. Oscillators are rising.
NEAR-TERM: Mixed to slightly bullish
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
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