[B]Forex Market Commentary for June 4, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The strong non-farm payrolls on Friday (and other firm reports) boosted the dollar against the majors. But by the end of the day the US currency was up against the yen and franc, down against the pound and the commodity currencies and flat against the euro. The carry trades are the flavor of the new month as well and this direction should continue.
Euro/dollar
The euro/dollar recovered losses after nailing a seven-week low of 1.3390 on Friday to close the week unchanged.
If this level gives way, expect a test of the support at 1.3375. Below this the Fibonacci retracement level there is support at 1.3275.
Initial resistance remains at 1.3530. A close above 1.3545 would signal another attack on the upside to 1.3610.
Oscillators are declining.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen to a four-month high of 122.14 on Friday and virtually matched the five-year high of 122.18. The outlook is cautiously bullish, but the pace of the rally should decelerate.
Above 122.18 the next resistance comes at 122.50 from another 50-point pivot, which targets 122.00 and 123.00.
Initial support is 121.80. Key support level remains at 121.05 from a 50-point pivot, which targets 120.55 and 121.55.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar climbed up again on Friday but remained in an inside range. The pound should consolidate further today, but the upside is favored.
More proof is needed to tell us where it’s going next.
If the resistance at 1.9900 breaks, then look for a rebound to 1.9925.
Initial support is at 1.9770. Below 1.9700 there still is good support at 1.9655.
Oscillators are mixed.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Mixed
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss franc again threatened the high of the uptrend and closed higher on Friday. The medium-term outlook remains positive, but today the pair should only consolidate.
Above the resistance at 1.2340 there is good resistance is at 1.2370. Next resistance is still seen at 1.2425.
Immediate support is at 1.2275. Strong support follows at 1.2210. Below 1.2170, the next levels are 1.2095 and 1.2065.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Slightly bearish