Thursday August 31, 2006 - 13:46:13 GMT
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Daily Forex Market Commentary for August 31, 2006
GFT Daily Forex Market Commentary for August 31, 2006
by: Cornelius Luca, Currencies Analyst, GFT
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The dollar was all over the place on Wednesday, advancing versus the yen, falling to a near three-week low against the pound, the trading sideways versus the euro and the Swiss franc. There are some US reports today, but keep your eyes on euro/yen and wait until Friday‚Äôs non-farm payrolls. Be careful here, as volume is diminishing further.
Euro/dollar made only a minor pullback and then a marginally new high for the upmove on Wednesday but closed virtually unchanged. Choppy trading should persist today as well.
Initial resistance is now seen at 1.2855. That is still followed by 1.2875 and 1.2900. Above 1.2938, the pair has resistance from a pivotal high at 1.2979.
Immediate support is between 1.2815 and 1.2795. That is followed by 1.2748, but this level should not be seen today. Below the1.2715 level, strong support remains between 1.2690 and 1.2700. Distant support is at 1.2655.
Oscillators are mixed.
Dollar/yen recovered all of the Tuesday losses, but again remained stuck in an inside range. It still needs to break out this range of 116.40 to 117.39 before new positions will be put on. The downside looks more vulnerable, but volume is getting even lighter these days, so anything goes.
The pair has initial support at 116.85 from another 50-point pivot, which targets 116.35 and 117.35. Below 115.80, good support remains at 115.50, from a 50-pip pivot, which targets 116.00 and 115.00.
Above 117.35, resistance is at 117.75. Good resistance is still seen at 118.25 from a 50-point pivot that targets 117.75 and 118.75.
Oscillators are mixed.
MEDIUM-TERM: Mixed to slightly bullish
The sterling/dollar rallied again on Wednesday and reached a near three-week high of 1.9059. The rally is overdone but the pullback, if any, should be mild.
Above 1.9059, resistance remains at 1.9095. Distant resistance is now pegged at 1.9145.
Initial support is now seen at 1.9015. The next levels are 1.8955 and 1.8915. These are followed by 1.8865. Distant support is at 1.8780.
Oscillators are edging higher.
NEAR-TERM: Mixed to slightly bullish
Dollar/Swiss franc traded sideways on Wednesday, as the downside was limited.
Below the pivotal support between 1.2268 and 1.2255, distant support remains at 1.2182.
Above 1.2315, dollar/Swiss franc still sees resistance at 1.2345. Strong resistance follows at 1.2375 and at 1.2420. Distant resistance follows at 1.2510.
Oscillators are edging lower.
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