Forex Market Commentary for July 1, 2008 by Cornelius LucaGFT Daily Market Commentary
The dollar encountered very choppy trading conditions on Monday, amid last minute position adjustment for the end of the quarter, and managed to reverse early losses. The US currency looks primed for a rally on the first day of the second half of the year. Keep an eye on the US manufacturing ISM report – it may have some short-lived impact.
Euro/dollar
The euro/dollar made the expected upmove only in early trading and then fell from a three-week low to close down on Monday. It looks like a bearish reversal and more weakness is likely today.
Initial support remains at 1.5720. The next good level is at 1.5685. Below 1.5630, further support remains at 1.5575.
Immediate resistance is at 1.5780. This is followed by 1.5842. Above 1.5930, euro/dollar sees additional resistance at 1.6020.
Oscillators are mixed.
NEAR-TERM: Bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen reversed aggressively from a three-week low to close flat on Monday, but my model remains short. The price action signals a bullish reversal, but Monday’s activity was less than crystal clear, so take the signal with a grain of salt.
Immediate resistance is still seen at 106.75 from another 50-point pivot, which targets 106.25 and 107.25. Distant resistance now comes at 107.95 from a 50-point pivot, which targets 107.45 and 108.45.
Initial support remains at 105.60 from a 50-point pivot that targets 105.10 and 106.10. Distant support is at 104.50 from another 50-point pivot, which targets 104.00 and 105.00.
Oscillators are falling.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar fell from a two-month high to close lower on Monday. My model remains long, but another attempt on the downside is likely today.
Immediate support is still seen at 1.9885. The next level is 1.9800. This is followed by 1.9710.
Initial resistance now comes at 1.9970. The next level is 2.0010. Above 2.0040, further resistance comes at 2.0145.
Oscillators are mixed.
NEAR-TERM: Mixed with downside bias
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss reversed from a 2 ½-month low to close higher on Monday. Another recovery attempt is likely on Tuesday.
Initial resistance remains nearby at 1.0230. Above 1.0295, resistance is at 1.0345 and 1.0390. This is followed by 1.0540.
Immediate support is at 1.0185. Below 1.0149, support is now seen at .9996.
Oscillators are mixed.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Mixed
LONG-TERM: Bullish