Monday June 26, 2006 - 12:53:27 GMT
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Daily Forex Market Commentary for June 26, 2006
Monday, June 26, 2006 8:00 GMT
By: Cornelius Luca
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The dollar rallied further on Friday amid expectations for two rate hikes by August and dollar/yen managed to close all of its April gap. Some strength should be seen today as well.
Euro/dollar fell sharply on Friday as well and the slide revitalized interest in the double top formation at play since May, which now targets 1.2440. Also encouraging is the formation of a bearish flag formation, which targets an enticing 1.2130. On the other hand there is support at the very close 1.2520 level on a closing basis from a trendline rising since March.
Assuming that 1.2520 is surpassed on the close, look for support at 1.2455 from a decent Fibonacci retracement level.
Strong resistance is at 1.2555. Next strong resistance is at 1.2660. Above the magic level at 1.2700
Oscillators are falling.
Dollar/yen rallied further on Friday. Expect another attempt higher today, but the upside looks limited.
Key resistance now comes from a 50-point pivot at 116.85 from another 50-point pivot, which targets 116.35 and 117.35. The later target also houses the resistance declining since December.
Immediate support is at 116.35. Below 115.75, look for a possible floor at 115.50, which targets 116.00 and 115.00.
Oscillators are mixed.
Sterling/dollar fell sharply on Friday as well to reach a two-month low of 1.8125 on Friday and only a close below the 50% mark of the April-May uptrend at 1.8137 would signal further weakness.
Below 1.8137 there is little strong support ahead of 1.7970 and 1.7930, but some interim support looms at 1.8060 and 1.8000.
Initial resistance is at 1.8280. A close above 1.8320 would signal that a forming bearish flag was wrong.
Oscillators are declining.
Dollar/Swiss franc rallied on Friday as well but the 50 percent retracement at 1.2558 must give way on a closing basis if the rally can continue.
Above 1.2558, resistance is at 1.2670. Strong resistance follows at 1.2708 from a Fibonacci retracement level.
Below 1.2445, support is now seen at 1.2320. The next level is 1.2210 from a Fibonacci retracement level.
Oscillators are rising.
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