Friday February 24, 2006 - 14:28:24 GMT
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Daily Forex Market Commentary - 2/24/2006
Daily Forex Market Commentary
Friday, February 24, 2006 8:00 GMT
By: Cornelius Luca, Currencies Analyst, GFT
Learn more about Global Forex Trading (GFT)
The dollar made a collapsing decline against the yen on Thursday following a wrong report that Bank of Japan was about ready to move away from the zero interest rate policy. The European currencies rallied as well, but only cable managed to hold on to its gains. All eyes will be on the volatile durable goods report on Friday â€“ at least for several minutes. Mixed trading should continue and the bias for the dollar is on the upside.
Euro/dollar rallied early on Thursday following the strong Ifo report but failed to surpass the 1.1973 and then trimmed gains. The pair should edge lower today.
Below 1.1890, support is still pegged to the 1.1850 area.Distant support is at 1.1770.
Immediate resistance is at 1.1940. Good resistance remains between 1.1980 and 1.2000. Next resistances are stacked at 1.2060 and 1.2105. Distant resistance then remains at 1.2205.
Oscillators are mixed.
MEDIUM-TERM: Slightly bearish
Dollar/yen collapsed to an over one-month low following a wrong report that the BoJ is approaching the moment of hiking rates. The slide alleviated the short-term overbought condition but the overall outlook remains bullish. Since the report was wrong, the pair should attempt to recover.
Initial support is 116.85 from another 50-point pivot, which targets 116.35 and 117.35. A close below 116.35 would signal the start of an aggressive decline.
Above 117.35, the pair has resistance at 118.25 from a 50-point pivot, which targets 117.75 and 118.75.
Oscillators are mixed.
MEDIUM-TERM: Slightly bullish
Sterling/dollar surged to a near two-week high and this rally extended its bullish bias. The pair just hit the tip of a triangle, so the risk is on the downside.
Initial support is now seen at 1.7475. The next level is 1.7420 and thatâ€™s followed by 1.7375. Below 1.7300 the pair has support at 1.7243.
Immediate resistance is pegged between 1.7555 and 1.7570. Above 1.7625, the pound has strong resistance at 1.7690.
The oscillators are rising.
Dollar/Swiss franc sank to a near two-week low early on Thursday, as expected, and then trimmed most of these losses. The pair should soon resume its uptrend.
Immediate support is at 1.3025. Below 1.2990 there is support at 1.2900. Only a close below 1.2840 would signal an acceleration of the decline and the pair would challenge the support at 1.2735.
Initial resistance is at 1.3150. Above this level, dollar/Swiss franc has pivotal resistance at 1.3200. Distant resistance is at 1.3280.
Oscillators are rising.
DISCLAIMER: 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.
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