[B]Forex Market Commentary for March 8, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
Unwinding of carry trades took a breather on Wednesday, as the dollar slumped versus the European currencies but trotted in place against the yen. We should see more of the same today, one day before the release of the US non-farm payrolls report.
Euro/dollar
Euro/dollar rallied further on Wednesday, as expected, and by now it recovered nearly 61.8% of the losses encountered since last Wednesday. So far, however, is still stuck in an inside range. It should now attempt to pad its gains, but it should be more difficult.
Initial resistance is at 1.3212. Above this level, the pair has strong resistance from a pivotal top at 1.3258. Further resistance looms at 1.3325 and 1.3367.
Immediate support is at 1.3140. Below 1.3110, the combination of two Fibos at 1.3070 still provides strong support. Next supports loom at 1.3030 and 1.3000.
Oscillators are mixed.
NEAR-TERM: Mixed with bullish bias
MEDIUM-TERM: Mixed with bullish bias
LONG-TERM: Bullish
Dollar/yen
The dollar/yen marked time on Wednesday and should edge lower.
Immediate support lies 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.
Above 116.50, 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.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar climbed up for the second day on Wednesday but remained within Monday’s range. The recovery is further jeopardizing the double top formation, which ultimately targets the 1.8720. Today should see only a mild recovery.
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
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss franc edged lower on Wednesday, as expected. It should make only a minor further decline today, as the outlook is mixed.
Initial support is at 1.2145. 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 1.2190. 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
MEDIUM-TERM: Bearish
LONG-TERM: Bullish