Wednesday January 10, 2007 - 14:24:20 GMT
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Daily Forex Market Commentary for January 10, 2007
GFT Daily Forex Market Commentary for January 10, 2007
Forex Market Commentary by Cornelius Luca, Currencies Analyst, GFT
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The FX markets have lacked much conviction early in the year and we need fresh elements to trigger a clean move. The dollar rallied versus the yen and Swiss franc on Tuesday, while marking time against the euro and the sterling. The yen fell versus the European currencies on profit taking, while the Swiss franc fell after the SNB made a point to emphasize that a weak franc versus the euro is beneficial for the local exports. The US trade data should not generate more than a quick spike or two. The dollar should attempt to advance further against the European currencies.
The euro/dollar reversed early gains on Tuesday and closed lower, but held above the six-week low of 1.2972. It should try making another run on the downside.
Initial support is at 1.2915. Below this, the pair has strong support at 1.2860. A break below this level would signal a further significant decline to 1.2763.
Immediate resistance is at 1.2985. The next level is 1.3030. Above 1.3065, euro/dollar has resistance at 1.3105. The next level is 1.3135.
Oscillators are falling.
Dollar/yen rallied on Tuesday to post the second highest close of the uptrend. The bias seems on the upside, but the top looks blocked by the psychologically significant 120. Look at the European currencies/yen crosses for additional cues.
The pair retains strong resistance at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15.
Initial support is at 118.80. Below 118.55, support is still seen at 118.25 from a 50-point pivot that targets 117.75 and 118.75. Further support is at 117.10.
Oscillators are mixed.
Sterling/dollar gave back most of the expected recovery made on Tuesday, and should attempt making another decline.
Initial support lies at 1.9375. Below 1.9340 the pair has support at 1.9250 and then at 1.9223 from a Fibonacci retracement level. The next big level is 1.9180. If it can break below it, then look for another sharp decline.
Immediate resistance is at 1.9450. Above it, the pair has strong resistance at 1.9485 and then at 1.9510. Further resistance is at 1.9570.
Oscillators are mixed.
NEAR-TERM: Mixed with downside bias
MEDIUM-TERM: Mixed with downside bias
Dollar/Swiss franc rallied again on Tuesday to reach the highest level since November 21. The rally was triggered by the laissez-faire attitude of the SNB toward its weak currency. The pair should attempt adding to its gains.
Initial resistance is at 1.2453. Next level is 1.2485. A Gann retracement level follows at 1.2550. Further resistance is at 1.2580 and a distant cap is at 1.2660
Immediate support now comes at 1.2390. The next level is 1.2355. Below 1.2290, 1.2260 and 1.2180 follow.
Oscillators are rising.
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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