Friday February 16, 2007 - 14:13:14 GMT
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Daily Forex Market Commentary for February 16, 2007
GFT Daily Forex Market Commentary for February 16, 2007
Forex Market Commentary by Cornelius Luca, Currencies Analyst, GFT
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The dollar fell sharply versus the yen and Swiss franc on Thursday amid mixed data. The Empire State index was strong, but the Industrial production. Philly Fed and the TIC data were very soft. The euro gave up its early gains and the pound was clobbered again because of weak economic reports. This means the crosses are holding the upper hand. They should remain in favor today as well, with all eyes on the US PPI, housing starts and U of Mich reports. The Europe/yen crosses should remain under pressure and the dollar should attempt to recover.
Euro/dollar surged further on Thursday, as expected, and nailed a 1 Â½-month high at 1.3171. It challenged and held significant resistance, so now the downside is favored.
Immediate support is at 1.3115. Next level is 1.3080. Below 1.3030 there is support at 1.2985 and 1.2940. There are two distant pivotal lows at 1.2882 and 1.2868.
Initial resistance remains at 1.3170. Above 1.3200, the euro/dollar should challenge the pivotal 1.3296 area.
Oscillators are rising.
NEAR-TERM: Mixed with downside bias
Dollar/yen declined further on Thursday, as expected. It has confirmed the formation of a double top, which targets 117.80, so following some mild recovery, the weakness should continue.
Immediate resistance is at 119.65 from a 50-pip pivot, which targets 120.15 and 119.15. Above 120.55 there is resistance at 121.05 from a 50-pip pivot, which targets 121.55 and 120.55.
Initial support is at 118.85. Dollar/yen then has support at 118.25 from another 50-point pivot that targets 117.75 and 118.75.
Oscillators are falling.
NEAR-TERM: Mixed to slightly bullish
Sterling/dollar made rallied early on Thursday, but the upside was limited, as expected, and the weak retail sales report tripped it.
A break below 1.9500 would signal a test of the key 1.9445 level.
Initial resistance is at 1.9550. The 1.9585 level must break if a further correction may ensue. Next level is 1.9635. Further resistance looms at 1.9676 from a pivot high.
Oscillators are mixed.
NEAR-TERM: Mixed to slightly bearish
Dollar/Swiss franc fell further on Thursday to a near 1 Â½-month low. The downside seems limited in the short term, so some initial correction is likely. However, the pair formed a head-and-shoulder pattern, which targets 1.2190, so the medium-term outlook is negative.
Initial resistance is at 1.2370. Above 1.2425, resistance remains at 1.2510. There is a pivotal high level is 1.2570.
Immediate support is now seen at 1.2330. Below 1.2290 there is support at 1.2220, but this level should not be seen.
Oscillators are edging lower.
NEAR-TERM: Mixed to slightly bullish
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