[B]Forex Market Commentary for February 23, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The dollar marched higher versus the yen, but gave up most of its gains against the European currencies on Thursday. This kept the Europe/yen crosses in demand and the European currencies should attempt to rally today. Be careful of Germany’s Ifo report, this could move the market.
Euro/dollar
Euro/dollar recovered from an eight-day low with help from a Fibonacci retracement level at 1.3075 to close little changed on Thursday. The upside is mildly favored.
Initial resistance remains at 1.3160. Above 1.3200, the euro/dollar should challenge the pivotal 1.3296 area.
Immediate support is at 1.3095. Next level remains 1.3080, which held beautifully on Thursday. Below 1.3030 there is support at 1.2985 and 1.2940. There are two distant pivotal lows at 1.2882 and 1.2868.
Oscillators are mixed.
NEAR-TERM: Mixed with bullish bias
MEDIUM-TERM: Mixed
LONG-TERM: Bullish
Dollar/yen
Dollar/yen rallied for the fourth consecutive on Thursday. hit the highest level since February 13. The pair stopped at the 78.6% Fibonacci retracement level at 121.46, so only a break above this level would warrant further strength.
Immediate resistance is at 121.55. There is a pivotal high at 122.08 and further resistance at 122.50.
Initial support is at 121.05 from a 50-pip pivot, which targets 121.55 and 120.55. Below 120.00 there is support at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15.119.15.
Oscillators are rising.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar encountered highly volatile conditions on Thursday, sinking first to the lowest levels of the week and then rallying to a one week high. This means it touched both boundaries of a triangle. The pair most break above the trendline at 1.9605 if this rally can continue. If not, look for a test of the key support at 1.9440.
Initial resistance is at 1.9605. Next level is 1.9635. Further resistance looms at 1.9676 from a pivot high.
Immediate support is at 1.9510. Then there us support between 1.9485 and 1.9475. A break below the key 1.9445 level would signal a test of 1.9390.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss franc allied to an eight-day high of 1.2437 in early European trading before turning down to give up most of its gains. It closed little changed and this suggests further lack of direction today. With the euro/Swiss cross quiet, take our cues from the euro after the release of the Ifo report.
Immediate support is still seen at 1.2340. Further support lies at 1.2313. Below 1.2285 there is support at 1.2220, but this level should not be seen.
Initial resistance is seen at 1.2410. Above 1.2455, resistance remains at 1.2510. There is a pivotal high level is 1.2570.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish