Forex Market Commentary for September 5, 2007 by Cornelius LucaGFT Daily Market Commentary
Tuesday saw the European currencies lower and the yen higher but it is too early to tell whether the yen crosses have started another decline here. With the markets still searching for clues of credit problems but eager to react to the recovering US stocks, the mood remains mixed for the dollar.
Euro/dollar
The euro/dollar recovered from a near two-week low on Tuesday. Look for mixed to lower trading again as the market needs more impetus for a new direction.
Below 1.3580, euro/dollar still has support at 1.3555. A break below the latter level would signal the resumption of the downmove. Next level is at 1.3480.
Initial resistance is at 1.3765. Above 1.3719 there is resistance at 1.3775.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Dollar/yen
Dollar/yen reversed early losses to close higher on Tuesday. Expect more sideways trading and get your cues from euro/yen.
Immediate resistance is at 116.85 from a 50-point pivot that targets 116.35 and 117.35. Above 117.68 there is good resistance at 118.25 from another 50-point pivot, which targets 117.75 and 118.75.
Initial support remains at 115.50 from another 50-point pivot, which targets 115.00 and 116.00.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar reduced some of its losses on Tuesday and this means that the rising uptrend is still barely in place. Expect further consolidation with an upside bias.
Strong resistance is at 2.0230. Strong resistance follows at 2.0290. Distant resistance is at 2.0400.
Immediate support is still seen at 2.0095. A break below the 1.9920 level would signal a further slide to 1.9780.
Oscillators are mixed.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss franc made another aggressive rally on Tuesday as well. The upside is limited here, but now expect only consolidation.
Immediate support is at 1.2060. Next level is 1.1990. Below 1.1870, support is seen at 1.1819.
Initial resistance is at 1.2155. Above 1.2219, the next distant resistance is at 1.2310.
Oscillators are mixed.
NEAR-TERM: Mixed with upside bias
MEDIUM-TERM: Bullish
LONG-TERM: Bearish