[B]Forex Market Commentary for March 7, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The oversold dollar made a much-needed bounce against the yen on Tuesday, and this helped the crosses against the yen bounce a little on profit taking. The dollar also climbed up against the franc, but fell versus the pound and the euro. Crosses against the yen should see a little more bounce while euro/sterling should remain under selling pressure.
One day after hitting its lowest level since Valentine’s Day, euro/dollar bounced and recovered nearly 38.2% of the losses encountered since last Wednesday. It should not attempt another day of recovery.
Initial resistance is at 1.3175. Above this level, the pair has strong resistance from a pivotal top at 1.3258. Further resistance looms at 1.3325 and 1.3367.
Initial support is at 1.3110. The combination of two Fibos still provides strong support is at 1.3070. Next supports loom at 1.3030 and 1.3000. Distant support is seen at 1.2940.
Oscillators are mixed.
NEAR-TERM: Mixed with bullish bias
MEDIUM-TERM: Mixed with bullish bias
The oversold dollar/yen recovered from a three-month low to eliminate the losses made a day earlier. The rally formed a potential bullish reversal, but this recovery may not last much longer before sterling and other currencies being sold again versus the yen.
Initial and strong resistance is at 116.85, from a 50-point pivot, which targets 116.35 and 117.35. Further resistance looms at 117.65 and 118.25.
Below 116.35 there is support at 115.80. Further support is at 115.50 from a 50-point pivot that targets 115.00 and 116.00. Distant support is pegged at 114.20 from another 50-point pivot, which targets 113.70 and 114.70.
After two days of aggressive losses, the pound recovered on Tuesday to eliminate nearly 38.2% of the slide since last Tuesday. The recovery is jeopardizing the double top formation, which ultimately targets the 1.8720. Today should see more of a recovery, but the pace should decelerate and then sales of sterling/yen should resume.
Initial resistance is at 1.9385. Above 1.9425 the pair has distant resistance at 1.9520.
Immediate support is at 1.9290. Below 1.9225, the pair should re-test its low at 1.9179.
Oscillators are falling.
NEAR-TERM: Mixed with upside bias
Dollar/Swiss franc edged further up on Tuesday, as expected, but should now edge lower.
Initial support remains at 1.2170. Below this strong level, support is still seen at 1.2100. Strong support then follows at 1.2030. Distant support is at 1.1880.
Immediate resistance is at 1.2155. The next level is at 1.2200. Above 1.2255, resistance remains at 1.2305. Next level is 1.2370.
Oscillators are mixed.
NEAR-TERM: Mixed with bearish bias