[B]Forex Market Commentary for February 26, 2007 by Cornelius Luca[/B]
GFT Daily Forex Market Commentary
The dollar fell across the board on Friday. All eyes are now of the dollar/yen for signs of a more sustained loss. The US currency should slip across the board.
Euro/dollar
Euro/dollar coined a seven-week high on Friday and probed the resistance of the trendline declining since early December in the 1.3170 area. The pair is hovering around the 0.236% Fibonacci retracement level of the October to December uptrend and 50% of the decline to January 22, and must move away from it them attract fresh interest.
The pair has strong resistance at 1.3240. There is a pivotal top at 1.3296.
Immediate support is at 1.3145. Further support is at 1.3080.
Oscillators are rising.
NEAR-TERM: Mixed with bullish bias
MEDIUM-TERM: Mixed
LONG-TERM: Bullish
Dollar/yen
Dollar/yen rallied held below the 78.6% Fibonacci retracement level at 121.46 on Friday and formed a short-term bearish reversal formation. The decline warns of a possible more significant downmove.
Immediate support is at 120.55. Strong support follows at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15.
Initial resistance is at 121.05 from a 50-pip pivot, which targets 121.55 and 120.55. Oscillators are rising.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Sterling/dollar
The pound was helped on Friday to an eight-day high by concern of rising inflation in the economy. The currency was also underpinned by news that the UK economy grew 0.8 percent in the fourth quarter, which is the fastest pace in 2 1/2 years. It broke above the top of a triangle but the break is minor enough at this point to remain only a red flag.
Initial resistance now comes at 1.9675. A pivotal high follows at 1.9748. Above 1.9775 there is resistance at 1.9810.
Below 1.9600, the pound finds support at 1.9565. A break below 1.9500 would signal a decline to 1.9403.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss franc sank to a seven-week low of 1.2293 on Friday and this slide revived the head-and-shoulders formation. Only a close below 1.2305 would signal another wave of weakness.
Below this level, support comes at 1.2220. Strong support then comes at 1.2145.
Above 1.2385, resistance remains at 1.2430. Next level is 1.2480. There is a pivotal high at 1.2565.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish