Forex Market Commentary for September 15, 2008 by Cornelius LucaGFT Daily Market Commentary
The dollar collapsed on Friday versus all majors except the yen on expectations that it recovered as much as it could for the time being. The soft retail sales didn’t help, and the market, while obsessed with the resolve of Lehman Brothers, cannot ignore the risk of other big names in trouble, such as Wa Mu. With the oil prices bouncing from $100/brl, commodities should bounce today as well. Since the uptrend of the dollar remains intact, take your cues from the reaction of the market to the Lehman outcome at the end of weekend.
Euro/dollar
Euro/dollar surged on Friday to recover part of last week’s losses that hit to a near 2 ½ year-low on Thursday. My model went long on profit taking. The pair must close above 1.4262 to signal a more sustained recovery.
Above 1.4262, strong resistance is seen between 1.4385 and 1.4395. Above 1.4450, distant resistance is at 1.4625.
Immediate support is at 1.4150. Below 1.4085, support is at 1.4010.
Oscillators are mixed.
NEAR-TERM: Bullish
MEDIUM-TERM: Bearish
LONG-TERM: Bearish
Dollar/yen
Dollar/yen has been alternating up and down days for four days and Friday was an up day. My model went long, but it’s not all that exciting.
Immediate resistance remains at 107.95 from a 50-point pivot, which targets 107.45 and 108.45. Above 108.70, resistance remains at 109.15 from another 50-point pivot, which targets 109.65 and 108.65. Distant resistance is at 110.35 from a 50-point pivot, which targets 109.85 and 110.85.
Initial support is at 106.75 from a 50-point pivot, which targets 106.25 and 107.25. A pivot low is at 105.53.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar surged impressively on Friday and turned my model long. The short term is bullish, but the medium-term outlook remains bearish.
Initial resistance is at 1.7975. Above the strong level at 1.8000, further resistance is seen at 1.8100 and 1.8190.
Below 1.7840, strong support is at 1.7732. Below 1.7672, a pivot low is at 1.7448.
Oscillators are mixed.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Bearish
LONG-TERM: Bearish
Dollar/Swiss franc fell sharply enough on Friday to turn my model short. The initial bias is lower, but the uptrend remains in place.
Immediate support is at 1.1240. Below 1.1144, support is pegged at 1.1090. This is still followed by 1.1010.
Initial resistance comes at 1.1360. Above 1.1417 there is a pivot high at 1.1605.
Oscillators are mixed.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish