[B]Forex Market Commentary for April 20, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The dollar fell across the board on Thursday but managed to recover its losses against all the majors but the euro. The oversold US currency looks like it formed a short-term bottom, so it should attempt to climb up today. Buy it only if the move is confirmed.
Euro/dollar
Euro/dollar made a marginally new high on Thursday, so its overall positive outlook remains intact. It’s overbought but dump it only on confirmation.
This confirmation would arise from a break below 1.3575. Good support follows at 1.3525. Below 1.3470 there is support at 1.3440. Distant support is at 1.3390.
Above 1.3818, the pair retains resistance at 1.3645. Above 1.3705, distant resistance is at 1.3805.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen touched the bottom of its rising channel in early trading on Thursday and then quickly and aggressively recovered most of its losses.
Initial support remains at 118.25 from a 50-point pivot that targets 117.75 and 118.75.
Below 117.60, support is seen at 116.85, from a 50-point pivot, which targets 116.35 and 117.35.
Above 118.75 strong resistance is still seen at 119.65 from a 50-point pivot that targets 119.15 and 120.15.
Oscillators are edging lower.
NEAR-TERM: Mixed
MEDIUM-TERM: Slightly bullish
LONG-TERM: Bullish
Sterling/dollar
One day after surging to a 26-year high of 2.0133 on Wednesday the obviously heavily overbought sterling/dollar headed lower. The move had been telegraphed by a probable doji. The decline was not impressive, so the pair should attempt to recover its strength today. The positive medium-term outlook remains in place, but it’s a hair away from turning south.
Initial resistance is at 1.2080. Next cap is seen between 2.0140 and 2.0155. If this area breaks, the pound would likely take attack a Gann level at 2.0200.
Immediate support is at 1.9980. Below 1.9955, strong support follows at 1.9925.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss franc recovered from a new four-month low of 1.2000 on Thursday and the oversold pair formed a bullish reversal pattern. Buy only on a confirmation or with a tight stop.
The confirmation should come from a break above the resistance at 1.2100. Further resistance comes at 1.2050. Next level is at 1.2095. Above 1.2145, the next level is 1.2200. Distant resistance is at 1.2255.
Immediate support is at 1.2000. Below it there is a key level at 1.1945. Dollar/Swiss franc then has strong support at 1.1885.
Oscillators are declining.
NEAR-TERM: Mixed
MEDIUM-TERM: Slightly bearish
LONG-TERM: Slightly bearish