GFT Daily Forex Market Commentary

[GFTforex]

Forex Market Commentary for January 31, 2007 by Cornelius Luca

GFT Daily Forex Market Commentary

Dollar/yen sank on Tuesday, forming a bearish reversal formation, while the European currencies consolidated quietly. This suggests that the Europe/yen crosses are finally in trouble, as carry trades are feeling some pressure, and this should be the driver today, ahead of the release of the US unemployment report on Friday.

Euro/dollar

Euro/dollar made little progress on Tuesday and should struggle for direction today as well. Following
Above 1.2990, the pair still has resistance at 1.3043. The next level is 1.3065.

Initial support is at 1.2930. 1.2882 follows. Below 1.2868, euro/dollar has strong support at 1.2820. A close below this level would signal a further significant decline to 1.2760. Next level is 1.2705. Distant support lies at 1.2595.

Oscillators are mixed.

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

Dollar/yen

Dollar/yen slumped on Tuesday, as expected. It should slip further today after forming a bearish reversal formation.
Below 121.55, the key support level is at 121.05 from a 50-pip pivot that targets 120.55 and 121.55. Initial is at 120.55. Further support is seen at 120.15.
Above 121.90, strong resistance remains at 122.50 from a 50-point pivot, which targets 122.00 and 123.00.
Oscillators are rising.

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

Sterling/dollar

Sterling/dollar stretched as high as 1.9694 on Tuesday before giving up its gains. The pair needs more information before a new direction ensues.
Initial resistance is at 1.9694. Above 1.9735, resistance comes at 1.9775 and then at 1.9810.
Immediate support is at 1.9586. That’s followed by 1.9547. Below the area between 1.9510 and 1.9500, strong support follows from a rising trendline at 1.9460. Further support lies at 1.9400.
Oscillators are mixed.

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

Dollar/Swiss franc

Dollar/Swiss franc consolidated further within an inside range. More information is needed.

Above 1.2565, resistance is seen at 1.2660 from the target of a bull flag. Next level is 1.2720.

Immediate support comes at 1.2490. Below 1.2430 there is support at 1.2375.
Oscillators are rising.

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





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