[B]Forex Market Commentary for June 26, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The dollar reversed early losses against the European currencies and the yen on Monday as the market consolidated after the slide a day earlier. Dollar/yen saw only temporary weakness after the BIS warned against the dangerously exposure of carry trades. More sideways trading should follow today, but the medium-term outlook is bearish for the dollar/Europe. Keep an eye on the US Consumer Confidence report today.
Euro/dollar
Euro/dollar traded in a less than 35-pip range on Monday, so traders are clearly looking for the next short-term direction. The medium-term outlook is bullish though.
Immediate resistance is still seen at 1.3480. A close above 1.3553 would signal another aggressive attack on the upside to 1.3610.
Initial support is at 1.3440. Below the 1.3373 level there is support at 1.3264 from a pivot low.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen managed to overthrow the BIS warning that the exposure to carry trades is dangerous at these mammoth levels and it recovered all of its early losses. We are back to square one, with 124.00 as the pivotal level to watch.
Immediate resistance is still seen from a 50-point pivot at 124.00 that targets 123.50 and 124.50.
Initial support is at 123.50. Below 123.00, key support comes at 122.50 from another 50-point pivot, which targets 122.00 and 123.00.
Oscillators are rising.
NEAR-TERM: Peaking
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar reversed early gains that saw it reach the highest levels since May 1 but remained close to these highs. The medium-term outlook remains bullish, but more choppy trading is now likely.
Initial resistance comes at 2.0002 from Monday’s high. Distant resistance remains between 2.0131 and 2.0151.
Immediate support is seen at 1.9940. If this level gives way on a closing basis, look for further support at 1.9910.
Oscillators are rising.
NEAR-TERM: Bullish
MEDIUM-TERM: Bullish
LONG-TERM: Bearish
Dollar/Swiss franc
Dollar/Swiss franc reversed losses from its lowest level since June 8 with help from the 55-day moving average – and a Fibonacci retracement level as well. It should attempt to bounce from here.
Above the resistance at 1.2310 there still is good resistance at 1.2350.
The initial support is at 1.2271 from Monday’s low. The next support is seen at 1.2230. Strong support follows at 1.2175.
Oscillators are falling.
NEAR-TERM: Mixed with upside risk
MEDIUM-TERM: Bullish
LONG-TERM: Mixed