Forex Market Commentary for March 11, 2008 by Cornelius LucaGFT Daily Market Commentary
The yen was the darling of the day on Monday, when it rallied versus the high yielding currencies – AUD, NZD and GBP. With credit crunch spreading by the day, risk adversity should continue. Dollar/yen should remain under pressure, while the European currencies should attempt to re-asserts themselves.
Euro/dollar
Euro/dollar made little progress on day after nailing a new record high. I like long positions in line with my model - still long since February 14. The pair is certainly overbought, but only a close below 1.5020 floor would jeopardize this bullish outlook.
Initial resistance is at 1.5405. Above the pivot top at 1.5456, resistance remains at 1.5575. The next level is at 1.5600.
Immediate support is at 1.5315. The next level remains at 1.5290. Below 1.5175, there is further support at 1.5020.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen remain weak after matching its eight-year low, and the selling pressure should continue. My system remains short positions since February 26 – this is still in good shape.
Initial support is at 101.00. The next level is 101.15. The next levels are 99.50 and 99.05.
Immediate resistance is now seen at 102.30 from a 50-point pivot, which targets 101.80 and 102.80. The next level is 103.20. Above 104.20, distant resistance remains at 104.50 from a 50-point pivot that targets 104.00 and 105.00.
Oscillators are declining.
NEAR-TERM: Bearish
MEDIUM-TERM: Bearish
LONG-TERM: Bearish
Sterling/dollar
Sterling/dollar reversed gains from a three-month high but the pressure should decelerate. My model remains long since February 2 and only a break below 1.9944 would turn it bearish.
Immediate support is now seen at 2.0025. Below 1.9945, the next level is seen at 1.9885.
Initial resistance now comes at 2.0135. A break above 2.0219 would signal another further rally to 2.0330.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss remains weak after closing at a new record low on Monday, but holding above Friday’s record low. The medium-term outlook remains bearish - my model remains short since February 21. Dollar/Swiss franc is oversold here and a brief bounce wouldn’t surprise.
Immediate support remains at 1.0135. Below it, support is now pegged at 1.0060.
Initial resistance now comes at 1.0255. Above 1.0290, the next level is 1.0370.
Oscillators are declining.
NEAR-TERM: Bearish
MEDIUM-TERM: Bearish
LONG-TERM: Bearish