[B]Forex Market Commentary for February 9, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The dollar rallied versus all of the majors, except the euro. The euro rallied across the board because the ECB head Trichet signaled further tightening of the borrowing costs. The dollar should encounter some weakness on Friday before any further strength can resume.
Euro/dollar
Euro/dollar reversed early losses and briefly broke above the 38.2% to 61.8% consolidation area (1.2825 to 1.3030). The initial bias is still bullish for Friday.
Initial resistance remains at 1.3064. Above the strong resistance at 1.3080, the pair has resistance at 1.3140 and further up at 1.3210.
Immediate support is at 1.3005. Below 1.2970 there is support a t1.2945 and 1.2913. Then, there are two pivotal lows at 1.2882 and 1.2868.
Oscillators are rising.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Mixed
LONG-TERM: Bullish
Dollar/yen
Dollar/yen rallied to a one-week high of 121.42 before trimming gains on Thursday. The rally should stall here and the bias is on the downside.
Initial support is at 121.05 by a 50-pip pivot, which targets 121.55 and 120.55. Below 120.55, the pair then has good support at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15.
Immediate resistance comes at 121.55. Above 121.87, the peak of March 2003, resistance remains at 122.50 from a 50-point pivot, which targets 122.00 and 123.00.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar fell sharply on Thursday, but we still need more information. Odds are, the pound should attempt to recover first.
There is immediate support at 1.9534. A break below the 1.9480 level would signal a further decline toward 1.9330.
Initial resistance is at 1.9630. The next level is 1.9695. If the Fibonacci retracement level at 1.9750 breaks, then the pound would challenge the next level 1.9822 – but this is very unlikely.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss franc made a stronger recovery on Thursday but then stalled. It should attempt to decline first, before any further advance can be possible.
Initial resistance is at 1.25150. Above 1.2475, there is the pivotal resistance is at 1.2575. Distant resistance comes at 1.2620.
Immediate support now comes at 1.2440. Below 1.2379, support remains at 1.2330. Strong support follows at 1.2285.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bullish