Forex Market Commentary for August 30, 2007 by Cornelius LucaGFT Daily Market Commentary
Choppy trading rules the FX markets. The yen crosses rallied on Wednesday in lockstep with the US indices, but this strength will be put to test near the highs, as it faces significant resistance. Again, the market lacks much direction ahead of the long weekend, so don’t get married to your positions. And keep an eye on the GDP data.
Euro/dollar
Euro/dollar reversed early losses and also the losses of this week’s. Its initial bias is now up.
Initial resistance is at 1.3700. This is followed by 1.3775. Above the weak trendline at 1.3820, resistance looms at 1.3853 from a pivotal high.
Immediate support is at 1.3625. Below 1.3595, euro/dollar still has support comes at 1.3555. A break below the latter level would signal the resumption of the downmove, but this is unlikely. Next level is at 1.3480.
Oscillators are mixed.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Dollar/yen
Dollar/yen surged unexpectedly on Wednesday to reverse all of its previous day’s losses. But it’s alternating up and down days and some selling pressure is likely. Get your cues from EUR/JPY.
Initial support is at 115.50 from another 50-point pivot, which targets 115.00 and 116.00. Distant support is at 114.20 from another 50-point pivot that targets 113.70 and 114.70. Distant support is at 113.05.
Immediate resistance is now at 116.25. Strong resistance is at. 116.85 from a 50-point pivot that targets 116.35 and 117.35.
Oscillators are mixed.
NEAR-TERM: Mixed with downside bias
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar made an aggressive recovery on Wednesday, which erased early losses – and Tuesday’s losses as well. The initial bias is down though.
Immediate support is now at 2.0090. Strong support follows at 1.9980. A break below the 1.9920 level would signal a further slide to 1.9780.
Initial resistance is at 2.0192. Above it, strong resistance follows at 2.0290. If the resistance at 2.0400 gives way, look for distant resistance at 2.0530.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss franc traded sideways. Expect some consolidation and then more weakness.
Immediate support is still seen at 1.1962. Below 1.1870, support is seen at 1.1819. Next level is 1.1788.
Initial resistance ermains at 1.2050. This is followed by 1.2110 and 1.2140.
Oscillators are mixed.
NEAR-TERM: Mixed with downside bias
MEDIUM-TERM: Bullish
LONG-TERM: Bearish