Forex Market Commentary for October 19, 2007 by Cornelius LucaThe dollar plunged on Thursday amid heightened expectations that the US economy is quickly headed for recession and that the Federal Reserves will be forced to cut borrowing costs as early as the end of the month. Its weakness should continue.
Euro/dollar
Euro/dollar climbed to a new high for its lifetime. Given that it failed to make even a brief pullback on Thursday, the euro/dollar should edged further up today.
Above 1.4343, strong resistance is seen only at 1.4400. Distant resistance is at 1.4500.
It has initial support at 1.4243. This is followed by 1.4195. Further supports are at 1.4145 and 1.4045.
Oscillators are rising.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen fell sharply to an over two-week low on Thursday and broke the support of a rising trendline. Further weakness is likely here.
Initial support comes at 115.50 from a 50-point pivot that targets 115.00 and 116.00. Distant support is at 114.25.
Immediate resistance is at 116.00. The key level remains 116.85 from another 50-point pivot that targets 116.35 and 117.35.
Oscillators are declining.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Slightly bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar rallied on Thursday to an over 2 ½-month high. Sideways to higher trading is now favored, as the upmove was not very convincing.
Initial resistance is at 2.0515. The next level is at 2.0595. This is followed by 2.0655.
Immediate support comes at 2.0380. This is followed by 2.0335.
Oscillators are mixed.
NEAR-TERM: Mixed to slightly bullish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss fell on Thursday as well and the move was vigorous enough to break it out of an inside range. The immediate bias is now negative.
Immediate support is seen at 1.1665. This is followed by 1.1620. Below 1.1585, there is distant support at 1.1495.
Initial resistance is at 1.1725. Above 117.90 there is resistance at 1.1850.
Oscillators are headed lower.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Mixed
LONG-TERM: Bearish
[B]See Also[/B]
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