Forex Market Commentary for July 30, 2008 by Cornelius LucaGFT Daily Market Commentary
The dollar surged on Tuesday amid lower oil prices and a seemingly decent US consumer confidence report. The stock markets did well enough on Tuesday to reverse Monday’s losses. Again, it’s summer time and trading should remain choppy. But with the dollar threatening channel lines supports in euro and pound and above the trendline against the franc, after early weakness the bias should be higher.
Euro/dollar
Euro/dollar collapsed to a five-week low, and my model remains short. The medium-term outlook is bearish again.
Initial support comes from the channel line 1.5560. Below the 1.5629 pivot low, strong support follows at 1.5585. The next good level is at 1.5550.
Immediate resistance is seen at 1.5630. The next resistance is 1.5770 from a Fibonacci retracement level. The next levels remain 1.5790, 1.5820, and 1.5860. These are followed by 1.5943. A pivot high remains at 1.6036.
Oscillators are declining.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Slightly bearish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen is still alternating up and down days, but on Tuesday it surged to a five-week high. My model remains long and the short-term outlook is slightly bullish.
Immediate resistance is at 108.45. Distant resistance is at 109.15.
Support moved up to 107.95 from a 50-point pivot, which targets 107.45 and 108.45. Distant support follows at 106.75 from a 50-point pivot, which targets 106.25 and 107.25.
Oscillators are rising.
NEAR-TERM: Mixed to slightly bullish
MEDIUM-TERM: Mixed to slightly bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar broke out of an inside range on the downside and my model is still short. It closed below the rising trendline and after initial strength the downside is favored.
Initial resistance now comes at 1.9860. Above 1.9880, the next significant level is at 1.9970. There is a pivot high at 2.0075.
Immediate and very strong support is now seen at 1.9763. This is followed by 1.9690. Distant support is still seen at 1.9650.
Oscillators are falling.
NEAR-TERM: Mixed to slightly bearish
MEDIUM-TERM: Slightly bearish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss surged to a five-week high on Tuesday and closed above the trendline resistance. My model is long and the upside is favored.
Immediate resistance is at 1.0512. Above 1.0545, resistance now comes at 1.0622. This is followed by 1.0790.
Initial support is seen at 1.0400. Below 1.0370, support now comes at 1.0315. Distant support is pegged at 1.0200.
Oscillators are rising.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Slightly bearish
LONG-TERM: Mixed