Forex Market Commentary for November 20, 2007 by Cornelius LucaGFT Daily Market Commentary
The dollar fell against the yen on another bout of weakness in the carry trades after Goldman Sachs added Citigroup to the dreaded “sell” list because of the large exposure to the subprime mortgage crisis. Meanwhile, the European currencies traded sideways. Expect choppy trading to continue and the main level to watch remains 109.15 in dollar/yen. Keep an eye on the US Housing starts report for October. Needless to say, this is hot data.
Euro/dollar
Euro/dollar did nothing on Monday and closed unchanged. Sideways trading should persist today as well.
Immediate resistance remains at 1.4705. Above 1.4751, resistance is seen at 1.4835.
Initial support is at 1.4610. The next level is 1.4550. This is followed by 1.4520 and 1.4470. Below 1.4415, euro/dollar has distant support comes at 1.4290.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen has been trading one day up and one day down in the past four days, and this silly pattern is to continue, then Tuesday should be an up day… That’s easier said than done, given the pressure on the carry trades, but mixed trading should continue for as long as the pivot at 109.15 remains in place.
Below 109.40, strong support comes at 109.15 from another 50-point pivot that targets 109.65 and 108.65.
Initial resistance moves to 110.35 from a 50-point pivot that targets 109.85 and 110.85. Distant resistance follows at 111.60 from a 50-point pivot, which targets 112.10 and 111.10.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar is trading sideways around 2.0525, which is 50% of the leg up between September 18 and November 9. Sideways trading should mark today’s trading as well.
Above 2.0525, resistance remains at 2.0590. Above it there is resistance at 2.0680. Distant resistance looms at 2.0805.
Immediate support is now seen at 2.0440. Below 2.0354, the next level is 2.0315.
Oscillators are mixed.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bullish
Dollar/Swiss franc
Dollar/Swiss fell to a new 12 ½-year low, as expected, and the oversold currency should edge further down today.
Immediate support is now seen at 1.1110. Below it, support is pegged at 1.1025. Distant support is at 1.0980.
Initial resistance is at 1.1195. The next level is 1.1260 and 1.1335 follows this. Above 1.1400, there is resistance at 1.1530.
Oscillators are falling.
NEAR-TERM: Slightly bearish
MEDIUM-TERM: Mixed
LONG-TERM: Bearish