Forex Market Commentary for May 1, 2008 by Cornelius LucaGFT Daily Market Commentary
The dollar ended the month of April in choppy or aggressive conditions, depending on the currency pair. It rallied versus the European and the commodity currencies, while reversing gains to close flat against the yen. The Federal Reserve met the market expectations and cut its rates by 25 bps and the dollar should now see more pressure. With the continental Europe closed for May Day, trading should be subdued.
Euro/dollar
Euro/dollar reversed from its lowest level since April 3 to close higher on Wednesday. My model remains short, but the upside risk should continue to Friday.
Immediate resistance is at 1.5645. A break above it would signal a more aggressive recovery to 1.5690. Distant resistance is at 1.5790.
Initial support is at 1.5570. The next level is 1.5480. Distant support is 1.5355.
Oscillators are falling.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen fell from a two-month high to close basically flat on Wednesday as well. The pair remains in an uptrend, my model is long, but the immediate outlook is still mixed.
Immediate resistance is at 104.50 from a 50-point pivot, which targets 104.00 and 105.00. The next levels remain at 105.20 and 105.60 from a 50-point pivot that targets 105.10 and 106.10.
Strong support s pegged at 103.40 from a 50-point pivot, which targets 102.90 and 103.90.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed to slightly bullish
LONG-TERM: Bearish
Sterling/dollar
Sterling/dollar surged from a two-month low to erase most of its Tuesday’s losses. My model now went long. The upside is limited.
Initial resistance is at 1.9923 from a declining line. Above 2.0025, strong resistance is now pegged at 2.0190.
Strong support comes at 1.9757. Distant support is at 1.9597.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss fell from a near two-month high to close lower on Wednesday. Unfortunately, choppy trading is expected today as well.
Immediate support is now seen at 1.0300. The next level remains at 1.0260. This is followed by 1.0185. Support is then pegged at 1.0135.
Initial resistance still comes at 1.0400. The next level is 1.0440. This is followed by 1.0550. Distant resistance now comes at 1.0625.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bearish