Daily Forex Market Commentary
GFT Daily Forex Market Commentary for January 29, 2007
Forex Market Commentary by Cornelius Luca, Currencies Analyst, GFT
Strong US data helped the dollar
advance further versus the European currencies and the yen on Friday, as
expected. Following some early correction, the European currencies and the yen should encounter further pressure versus the dollar.
Euro/dollar
The euro/dollar sank on Friday to a two-week low and this decline was in line with expectations. Following a minor bounce, the pair should edge lower again.
Above 1.2970, the pair has resistance at 1.3043. The next level is 1.3065.
Initial support is at 1.2882. Below 1.2868, euro/dollar has strong support at 1.2820. A close below this level would signal a further significant decline to 1.2760. Next level is 1.2705. Distant support lies at 1.2595.
Oscillators are falling.
NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bullish
Dollar/yen
Dollar/yen recovered on Friday, as expected, but kept below its recent four-year highs. Following an initial decline, it should attempt another upmove.
The key support level is at 121.05 from a 50-pip pivot that targets 120.55 and 121.55. Initial is at 120.55. Further support is seen at 120.15. Strong support follows at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15.
Above 121.87, which is the high in March 2003, resistance remains at 122.50 from a 50-point pivot, which targets 122.00 and 123.00.
Oscillators are rising.
NEAR-TERM: Mixed
MEDIUM-TERM: Bullish
LONG-TERM: Bullish
Sterling/dollar
Sterling/dollar fell further on Friday and reached a two-week low. The pair is less overbought and is approaching key support. It should first bounce and then head lower again.
Below 1.9561, strong support comes at 1.9510 from combined Fibonacci levels. A close beneath it would call for a further bout of weakness to the rising trendline at 1.9450.
Initial resistance is at 1.9665. Above 1.9735, resistance comes at 1.9775 and then at 1.9810. Distant resistance follows at 1.9910.
Oscillators are falling.
NEAR-TERM: Mixed to slightly bearish
MEDIUM-TERM: Bullish
LONG-TERM: Mixed
Dollar/Swiss franc
Dollar/Swiss franc rallied for the eighth week to hit a new 2 ½-month high on Friday. More information is needed. The overall bias is bullish, but the first move should be lower.
Immediate support comes at 1.2490. Below 1.2430 there is support at 1.2375.
Above 1.2565, resistance comes at 1.2660 from the target of a bull flag. Next level is 1.2720.
Oscillators are rising.
NEAR-TERM: Mixed to slightly bullish
MEDIUM-TERM: Mixed
LONG-TERM: Mixed
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