Thursday August 5, 2004 - 12:53:04 GMT
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Daily Forex Commentary by Global Forex Trading
Daily Commentary By Cornelius Luca, forex analyst, Global Forex Trading
The dollar failed to hold on to early gains and closed little changed versus the European currencies. However, it managed to retain some of its gains made against the yen. Summer trading should remain choppy on Thursday.
The euro/dollar recovered early losses that reached a seven-week low on Wednesday and closed virtually unchanged. While the candlestick chart suggests a recovery today, itís more likely that the pair will hold within recent ranges.
Good resistance remains at 1.2100 and a further rally would target the area between 1.2189 and 1.2207.
Below 1.1990 pivotal support remains at 1.1968 and at 1.1950 and a break lower would target the distant 1.1865 level.
Oscillators remain mixed.
Dollar/yen saw more than some respite on Wednesday, when it rallied as high as 111.72 before trimming gains.
Key resistance remains from the 111.60 50-point pivot, which targets 112.10 and 111.10. A break above the 112.10 level would signal a rally to 112.46. Distant resistance is at 112.90 from the 50-point pivot that targets 113.40 and 112.40.
Below 110.38, dollar/yen still has support at 110.00. Key support then remains at 109.15.
Oscillators are mixed.
NEAR-TERM: Mixed to slightly bullish
MEDIUM-TERM: Slightly bullish
Once again, sterling/dollar recovered its losses on Wednesday with help form the support of its 100-day moving average, now at around 1.8178. The pair is still challenging the top of its wider declining channel at 1.8252.
With the Bank of England expected to hike rates by 25 basis points today, there is still a good chance that the pound will break above the top of this channel.
Above 1.8300, the sterling/dollar has pivotal resistance at 1.8335. Further resistance remains at 1.8392 and 1.8445. An unexpected break higher would target 1.8480.
The pair has initial support at 1.8177 and a break lower would signal another test of 1.8150. A drop to the pivotal 1.8083 low remains unexpected. A further decline to the pivotal support at 1.8010 should not be seen.
Oscillators are mixed.
MEDIUM-TERM: Slightly bearish
LONG-TERM: Slightly bullish
Dollar/Swiss franc on Wednesday fell from a 2 1/2-month high of 1.2856 to close little changed, and this sideways trading should continue today.
Above 1.2856, the pair still has good resistances at 1.2916 and then at 1.2957 from a Fibonacci retracement level. A break higher would signal an aggressive rally to 1.3085.
Dollar/Swiss franc has support at 1.2700 and a break lower would challenge the nearby, but tough, 1.2685 area. A slide to 1.2600 remains unlikely.
Oscillators are mixed.
DISCLAIMER: This forum and 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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