[B]Forex Market Commentary for April 12, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The dollar failed to benefit for long from the FOMC statement that the Fed was not about to cut rates. It rallied against the yen and fell versus the pound, but didn’t make that much progress overall. With no data to be released, the dollar should trade sideways on Thursday.
Euro/dollar
Euro/dollar traded sideways on Wednesday after nailing an over two-year high a day earlier. The lack of follow through, which I feared a day earlier, suggests more sideways trading today.
Above Tuesday’s high at 1.3445, resistance remains at 1.3475 and 1.3510. The next levels are 1.3555 and 1.3588. There is a pivotal high at 1.3666.
Immediate support comes at 1.3420. The next levels are 1.3365 and 1.3340. Below 1.3300, support is pegged at 1.3253.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen climbed up on Wednesday to its highest level since late February, as the possible IMF/G7 developments toward China coming up at the weekend were quickly put on the back burner. Sideways trading is favored, but watch out for the big levels nearby.
Initial and key resistance is still seen at 119.65 from another 50-point pivot that targets 119.15 and 120.15. Above 120.75, distant resistance now comes at 121.05 from another 50-point pivot.
Below 118.75, strong support remains at 118.25 from a 50-point pivot that targets 117.75 and 118.75.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Slightly bullish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar made the expected upmove on Wednesday, or at least for part of the day. Its failure to surpass the recent high translated in profit-taking sales. It should consolidate today.
Immediate resistance is at 1.9795. If the pivotal level at 1.9821 breaks, the pound would likely attack the 1.9905 area.
Initial support remains at 1.9705. Below 1.9680, strong support follows at 1.9640. A pivotal low is at 1.9590.
Oscillators are rising.
NEAR-TERM: Mixed with bullish bias
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Dollar/Swiss franc
The dollar/Swiss franc traded sideways to higher on Wednesday after falling sharply on Tuesday. The pair is now trading in the middle of its rising channel, so more sideways trading is likely.
Initial resistance comes at 1.2240. Above 1.2282, strong resistance comes at 1.2330.
Below 1.2140, support is seen at 1.2125, which marks the bottom the channel. If this floor buckles, then dollar/Swiss franc would likely challenge the 1.2075 level. A key level follows at 1.2050.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed with upside bias
LONG-TERM: Mixed