Daily forex market commentary

Forex Market Commentary for October 19, 2006 by Cornelius Luca
GFT Daily Forex Market Commentary
Visit GFT to Learn More

The dollar faced choppy trading and closed very little changed on Wednesday. The CPI fell 0.5% in September after rising 0.2% in August, and the core CPI rose 0.2%. Housing starts unexpectedly rose 5.9% in September but permits fell 6.3% to the lowest rate since October 2001. Expect more choppy trading today. Only the Philly Fed report could be a market mover.

Euro/dollar
Euro/dollar traded sideways and closed virtially unchanged on Wednesday but remained well within Friday's range again. It should trade sideways again.

Initial support is at 1.2470. Next support comes at 1.2410. A close below this level would also trigger a double top formation, which targets 1.1920. But that remains far away. Below 1.2370, support now comes at 1.2310.

Above 1.2576, the euro/dollar has resistance at 1.2615. Strong resistance follows at 1.2650.The pair must close below the strong support at 1.2470 to confirm versus weakness.

Oscillators are declining.

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

Dollar/yen
Dollar/yen fell to as low as 118.31 on Wednesday, but again it recovered most of its losses, so Thursday should see an attempt of recovery.

Initial resistance is at 119.00. The key level resistance is at 119.65 from a 50-point pivot that targets 119.15 and 120.15. Above 120.15, resistance is seen at 120.50. Further resistance is the pegged at 121.05 from another 50-point pivot that targets 120.55 and 121.55.

Below 115.50, dollar/yen has support at 118.25 by another 50-point pivot that targets 117.75 and 118.75.

Oscillators are rising.

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

Sterling/dollar
Sterling/dollar rallied to a 12-day high on Wednesday before edging lower. Choppy trading should persist, but the downside is favored.

Immediate support is stillseen at 1.8660. That’s followed by 1.8600 and 1.8555.

Initial resistance is seen at 1.8734. Above 1.8770, resistance comes at 1.8800 and 1.8860.

Oscillators are declining.

NEAR-TERM: Mixed to slightly bearish
MEDIUM-TERM: Slightly bearish
LONG-TERM: Bullish

Dollar/Swiss franc
Dollar/Swiss traded sideways and closed with small gains. It should see some very mild strength today.

Initial resistance is at 1.2750. Above 1.2768, the pair still has resistance at 1.2800. Next level is at 1.2910.

Below 1.2640, dollar/Swiss franc has support at 1.2590. Distant support is at 1.2500.

Oscillators are rising.

NEAR-TERM: Bearish to slightly bullish
MEDIUM-TERM: Mixed to slightly bullish
LONG-TERM: Bearish

DISCLAIMER: This forum and the information provided here should not be relied on as a substitute for extensive independent research before making your investment decisions. Global Forex Trading is merely providing this column for your general information. The views of the author are not necessarily those of Global Forex Trading, its owners, officers, agents or employees. In addition, any projections or views of the market provided by the author may not prove to be accurate. Global Forex Trading and Cornelius Luca will not be responsible for any losses incurred on investments made by readers and clients as a result of any information contained in this column. Global Forex Trading and Cornelius Luca do not render investment, legal, accounting, tax, or other professional advice. If investment, legal, tax, or other expert assistance is required, the services of a competent professional should be sought.