Forex Market Commentary for November 8, 2007 by Cornelius LucaGFT Daily Market Commentary
The dollar remained under pressure versus the European currencies and the yen after the China’s newest financial game to show its power (see said plans to diversify its FX reserves by selling US assets). But the commodity currencies tanked on risk reduction and the carry trades don’t look so hot anymore. The dollar should head higher here, but prepared for a rocky road.
Euro/dollar
Euro/dollar rallied to a new lifetime high as expected but the late slide on Wednesday means more downward correction.
Initial support is at 1.4580. Below 1.4545, euro/dollar has 1.4490. Distant support comes at 1.4415.
Above 1.4727, resistance is now seen at 1.4755. Above it, distant resistance is seen at 1.4890.
Oscillators are rising.
NEAR-TERM: Bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen collapsed to close at its lowest level in 1 ½-years. More weakness is likely.
Initial support comes at 112.12. The next level is 111.60.
Immediate resistance is at 112.90 from a 50-point pivot that targets 113.40 and 112.40. Distant resistance is at 114.20 from a 50-point pivot that targets 113.70 and 114.70.
Oscillators are falling.
NEAR-TERM: Bearish
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar surged to a new high for the uptrend, as expected, but its late slide suggests further possible profit taking.
Immediate support is seen at 2.0910. 2.0860 is followed by 2.0770 and 2.0740. Distant support is pegged at 2.0685.
Initial resistance is at 2.1070. Above is there is distant resistance at 2.1220.
Oscillators are rising.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss fell sharply to a new low for the downtrend, but its late recovery suggests liquidating short positions for now.
Initial resistance is seen at 1.1410. The next level is 1.1520. This is followed by 1.1590. Distant resistance is at 1.1655.
Below 1.1260, support is seen at 1.1180. Distant support is at 1.1100.
Oscillators are falling.
NEAR-TERM: Slightly bullish
MEDIUM-TERM: Mixed
LONG-TERM: Bearish