Daily Forex Market Commentary
GFT Daily Forex Market Commentary for January 18, 2007
Forex Market Commentary by Cornelius Luca, Currencies Analyst, GFT
The market needs more information, as buying sterling/yen won’t last forever. Dollar/yen is reaching new highs for the uptrend amid the BoJ-induced drama about the next rate hike, which is insignificant. The Cable remains strong but near a big resistance, while the euro and the franc are still marking time. Unless new factors emerge, expect more of the same today.
Euro/dollar
The euro/dollar traded sideways to close virtually unchanged on Wednesday as well. It seems to be trying for a bearish flag, but confirmation is needed. Also, the pair must close below 1.2925 to trigger further losses in line with the double top formation.
Below 1.2868, the pair retains strong support at 1.2820. A close below this level would signal a further significant decline to 1.2760.
Above 1.2970, euro/dollar has resistance at 1.2988 and 1.3015. Distant resistance is at 1.3085.
Oscillators are falling.
NEAR-TERM: Mixed
MEDIUM-TERM: Bearish
LONG-TERM: Bullish
Dollar/yen
Dollar/yen made a marginally new high for its uptrend, while the market remains awash in rumors that the BoJ will or will not hike its rates from near zero by an insignificant .25 percent. The pair held above 120 and should not attempt to test the next big figure. The pound/yen crosses should provide direction again.
The pair retains strong resistance at 121.05 from another 50-pip pivot, which targets 121.55 and 120.55. There is a pivotal high at 121.40.
Below 120.45, support is seen at 120.15. Strong support follows at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15. Distant resistance is seen at 118.80.
Oscillators are rising.
NEAR-TERM: Mixed with bullish bias
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Sterling/dollar
Sterling/dollar remains the strongest of the European currencies’ lot, and rallied further on Wednesday as well, as expected. It’s testing major resistance here, so only sell the Cable on a confirmation.
Immediate resistance is at 1.9715 from the tough trendline. If it gives way, then the pair has resistance at 1.9755. Distant pivotal resistance remains at 1.9846.
Below 1.9635, support is still seen at 1.9570. Distant support is now seen at 1.9510.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed with downside bias
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss franc did nothing on Thursday. The pair should consolidate and try to break our of the sideways phase.
Initial resistance remains at 1.2528. Above 1.2550, resistance comes at 1.2660 from the target of a bull flag.
Immediate support comes at 1.2430. That is followed by 1.2385.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
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