Forex Market Commentary for July 17, 2008 by Cornelius LucaGFT Daily Market Commentary
Bouncing equity markets, a declining oil price (OK, only for two days) and a decent industrial production report helped the dollar recover on Wednesday. The medium-term outlook remains negative, but expect the dollar to attempt another recovery today. Keep an eye on the US housing data (but can’t expect a good report) and on the Philly Fed.
Euro/dollar
Euro/dollar fell on Wednesday and this prompted my model to go short. The short-term outlook is slightly bearish, but the medium-term outlook remains bullish.
Below 1.580, support is still seen at 1.5765. The next good level remains at 1.5685. Distant support is 1.5630.
Immediate resistance is at 1.5860. The next levels are 1.5910 and 1.5970. A pivot high now follows at 1.6036. Above 1.6055, distant resistance is at 1.6135.
Oscillators are mixed.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen reversed from a new 1 ½-month low with help from a short-term declining channel line, but the recovery was not strong enough to signal a bullish reversal formation. The pair should attempt to continue its recovery today.
Immediate resistance is at 105.60 from a 50-point pivot that targets 105.10 and 106.10. Distant resistance is at 106.75 from a 50-point pivot, which targets 106.25 and 107.25.
Initial support is at 104.50 from another 50-point pivot, which targets 104.00 and 105.00.
Oscillators are mixed.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar fell on Wednesday but got stuck in an inside range. My model remains long. Cable should first edge lower, but the medium-term outlook remains positive.
Immediate support is now seen at 1.9960. Below 1.9905, support is now seen at 1.9850.
Initial resistance now comes at 2.0005. This is followed by 2.0085. A pivot high follows 2.0155. Distant resistance is at 2.0250.
Oscillators are mixed.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss made an incipient bullish reversal on Wednesday. My model remains short, but barely. The pair should test the upside first.
Immediate resistance is at 1.0200. Above 1.0245, resistance now comes at 1.0315. This is followed by 1.0390.
Initial support is at 1.0135. Below 1.0095, support is now seen at 1.0013 and .9984.
Oscillators are mixed.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Slightly bearish
LONG-TERM: Mixed