Forex Market Commentary for November 6, 2007 by Cornelius LucaGFT Daily Market Commentary
The dollar corrected higher versus the pound, euro and yen, but remained under mild selling pressure against the franc on Monday. The non-manufacturing ISM was decent, but at this point the market cares more about the ravages of the subprime derivatives. The market only paused after the choppy move on Friday and Tuesday may more of the same before the next move lower.
Euro/dollar
Euro/dollar slipped on Monday but got stuck in an inside range and more information is thus needed. The key for now is in the EUR/CHF cross, which is declining in a one-day-up and one-day-down manner.
Initial support is at 1.4455. Below 1.4405, euro/dollar still has support at 1.4315. Only a break below 1.4195 would signal a more sustained decline.
Immediate resistance is still seen at 1.4533. Above it, strong resistance is seen at 1.4580. Next resistance is at 1.4665. Distant
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen trimmed losses after sinking to a one-week low of 114.02 Monday. Again, expect mixed trading to persist.
Initial support comes at 114.20 from a 50-point pivot that targets 113.70 and 114.70. Below 113.50, strong support is at 112.90 from a 50-point pivot that targets 113.40 and 112.40. There is a distant pivot low at 111.60 which is also a 50-point pivot, which targets 112.10 and 111.10.
Above 115.05 there is strong resistance at 115.50 from another 50-point pivot, which targets 115.00 and 116.00.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Slightly bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar fell on Monday to erase most of the gains made a day earlier, but this pullback was confined to an inside range, so more information is needed. As of now, it’s likely that the pair will bottom today and then attempt to advance further.
Immediate support is seen at 2.0756. Next level is at 2.0685. Distant support is pegged at 2.0550, but the odds of reaching it are extremely remote.
Initial resistance is at 2.0900. The next level is 2.1025.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss edged marginally lower on Monday as a function of the EUR/CHF cross but got stuck in an inside range. After a mild pullback the weakness should resume. . Hold short positions in this oversold pair until there is a confirmed bottom.
Below 1.1493, support remains at 1.1455. Below 1.1410, there is support at 1.1365.
Initial resistance is still at 1.1590. Above 1.1655, there is resistance at 1.1740.
Oscillators are falling.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bearish