GFT Daily Market Commentary

Forex Market Commentary for November 2, 2007 by Cornelius LucaGFT Daily Market Commentary

The dollar fell against the yen while rallying against the Aussie and the Kiwi on a shake up in carry trades. The euro fell as well, but the other European currencies only gave back gains after hitting new highs for their uptrend. The US data was soft, highlighting recessionary tendencies. All eyes are now on the key non-farm payrolls; the ADP report suggests a high figure, but even if it is strong, the next month’s report should be terrible. It seems like another choppy day for the dollar, with the carry trades under pressure.

Euro/dollar

Euro/dollar made a potential bearish reversal on Thursday after rallying to another lifetime high a day earlier. It is very overbought but hold sell further only if the US unemployment data gives the green light.
Immediate support is at 1.4375. This is followed by 1.4320. Below 1.4280, euro/dollar still has support at 1.4210.
Strong resistance is now seen at 1.4505. Above it, strong resistance is seen only at 1.4580. Distant resistance is at 1.4665.

Oscillators are rising.

NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish

Dollar/yen

Dollar/yen slumped from a two-week high and formed a potential bearish reversal after the yen crosses fell on profit taking. Sideways to lower trading is likely.

Initial support is at 114.20 from a 50-point pivot that targets 113.70 and 114.70. Below its there is strong but distant support is at 112.90 from a 50-point pivot that targets 113.40 and 112.40.
Immediate resistance is seen at 115.00. This is followed by 115.50 from another 50-point pivot, which targets 115.00 and 116.00. Further resistance is at 116.45.
Oscillators are mixed.

NEAR-TERM: Mixed
MEDIUM-TERM: Slightly bullish
LONG-TERM: Mixed

Sterling/dollar

Sterling/dollar rallied to yet another 26-year high on Thursday but gave back its gains on profit taking. The overbought pair formed a potential bearish reversal formation, but sell it only on a confirmation.

Immediate support remains at 2.0755. Below 2.0655 there is support at 2.0550.
Initial resistance is now seen at 2.0875. This is followed by 2.0910. Then there is distant resistance at 2.1050.

Oscillators are rising.

NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish

Dollar/Swiss franc

Dollar/Swiss struggled lower to a new 2 ½-year low. The immediate bias is mixed with upside risk.

Immediate support is seen at 1.1525. Below 1.1495, there is support at 1.1408.

Initial resistance is at 1.1625. Above 1.1675, the next levels are 1.1715 and 1.1765. These levels are followed by 1.1812 from a Fibonacci retracement level.

Oscillators are mixed.

NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bearish