GFT Daily Market Commentary

[GFTforex]

Forex Market Commentary for May 29, 2008 by Cornelius LucaGFT Daily Market Commentary

The dollar rallied on Wednesday as well versus all majors but cable, in part because of a better than expected durable goods orders report. But the crude oil made an aggressive recovery. The US currency should only consolidate today.

Euro/dollar

The euro/dollar sank to an over one-week low on Wednesday and my model remains short. Only a break below 1.5600 signals more weakness; if not, the medium-term upmove should resume.

Key support is at 1.5600. A close below this level would signal a sustained decline and the next level would become 1.5550. This is followed by 1.5460.
Initial resistance is now seen at 1.5690. The next levels are 1.5740 and 1.5811. Above 1.5865, euro/dollar has distant resistance at 1.6020.

Oscillators are mixed.

NEAR-TERM: Mixed to slightly bearish
MEDIUM-TERM: Mixed to slightly bullish
LONG-TERM: Bullish

Dollar/yen

Dollar/yen rallied broke out of an inside range on Wednesday on its way to a two-week high. My model remains long. Expect another attempt on the upside today, only that this looks tough to break now.

Immediate resistance is now at 105.30. Above 105.70, there is further strong resistance at 106.35.
Below 104.50 from a 50-point pivot, which targets 104.00 and 105.00, distant support follows at 103.40 from a 50-point pivot, which targets 102.90 and 103.90.

Oscillators are rising.

NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bearish

Sterling/dollar

Sterling/dollar reversed early losses to close higher on Wednesday, but remained in an inside range. My model remains long, but the immediate outlook is mixed.

Initial resistance remains at 1.9850. Above it, there is further resistance at 1.9910. Distant resistance is at 2.0030.
Immediate support is at 1.9760. This is followed by 1.9645. Only a break below 1.9545 would jeopardize the cable’s recovery.
Oscillators are mixed.

NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Mixed

Dollar/Swiss franc

Dollar/Swiss reversed early losses in a dramatic fashion to close higher on Wednesday, and my model went long. But it moved up too much too fast, and the immediate outlook is mixed to slightly bullish.

Initial resistance now comes at 1.0425. If this level is surpassed, then expect a test of 1.0510. Distant resistance is perched at 1.0623.
Immediate support is still seen at 1.0305. This is followed by 1.0200, 1.0130 and 1.0105.
Oscillators are rising.

NEAR-TERM: Mixed to slightly bullish
MEDIUM-TERM: Slightly bullish
LONG-TERM: Bearish