Thursday December 14, 2006 - 13:58:13 GMT
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Daily Forex Market Commentary - 12/14/2006
GFT Daily Forex Market Commentary for December 14, 2006
Forex Market Commentary by Cornelius Luca, Currencies Analyst, GFT
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The dollar made an aggressive recovery on Wednesday with help from a strong US economic report: retail sales expanded a more than expected 1.0 percent in November, the most since July. It should attempt to pad its gains on Thursday, a day that there is no report due for release.
The overbought euro/dollar made a sharp decline on Wednesday and reversed all of the gains made on Monday and Tuesday. We are now at the levels where it closed on Friday and the market needs some more impetus for the next move.
If the pair marched lower, look for support at 1.3145. This is a strong level and a break below it could trip the euro/dollar toward its pivotal low at 1.3065. Thatâ€™s unlikely. Distant support looms at 1.2985.
Above 1.3250, strong resistance follows at 1.3290 and then at 1.3325. Distant resistance is pegged at 1.3367.
Oscillators are mixed.
Dollar/yen marched higher on Wednesday and hit a new high for the uptrend. The pair broke and closed above the resistance of a declining trendline and looks pretty powerful here. However, it is mildly overbought in the short term and late Thursday the BoJ will release its much-awaited Tankan report, which can swing either way. The immediate risk comes from the severely crosses against yen, which may tumble at any time.
Above 117.75, the pair has resistance at resistance remains at 118.25 from a 50-point pivot that targets 117.75 and 118.75. Distant resistance is seen at 119.65.
Good support is from the 50-point pivot at 116.85, which targets 116.35 and 117.35. Below 115.80, dollar/yen has support from the 50-pip pivot at 115.50, which targets 116.00 and 115.00. Strong support is at 114.40, which is 50% mark of a long-term uptrend.
Oscillators are rising.
NEAR-TERM: Slightly bullish
Sterling/dollar made a mild decline and closed slightly lower on Wednesday. Cable should consolidate more â€“ unless GBP/JPY gets annihilated.
Initial support comes at 1.9640. Below 1.9590, there is support at 1.9525. Distant support is at 1.9460.
Above 1.9725, resistance is seen at 1.9765. Distant resistance is at 1.9815.
Oscillators are mixed.
Dollar/Swiss franc eased for the second say and it must turn aroubd quickly if it is to resume its upmove.
Dollar/Swiss franc rallied smartly on Wednesday and will attempt to climb higher today.
Initial resistance is at 1.2100. Next level is at 1.2135. Distant resistance looms at 1.2210.
Strong support now comes at 1.2020 from a pivot low. Below 1.1970, distant support is at 1.1895.
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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