Daily Market Commentary

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The dollar surged further on Wednesday

Wed, Jun 11 2008, 06:04 GMT
by Cornelius Luca

GFT (Global Forex Trading)


The dollar surged further on Wednesday after Fed Chairman Bernanke pummeled the market with talk about focusing on inflation, which of course suggests higher rates. Again, Wednesday should see residual strength, but the medium term outlook remains negative.


Euro/dollar

The euro/dollar suffered further losses after forming a bearish reversal formation on the daily chart. My model went short. Only a break below 1.5410 would warrant further weakness. So, immediate support is now seen at 1.5410. The next support follows at 1.5365. Distant support is at 1.5287. Strong resistance is at 1.5530. Above 1.5590, euro/dollar has strong resistance at 1.5645. Further resistance is then seen at 1.5842.

Oscillators are falling.

NEAR-TERM: Slightly bearish
MEDIUM-TERM: Slightly bullish
LONG-TERM: Bullish


Dollar/yen

Dollar/yen surged to a 3 ½-month high on Tuesday and tested a long term Fibonacci retracement level at 107.42. Initial resistance is now at 107.95 from another 50-point pivot, which targets 107.45 and 108.45. Distant resistance is then seen at 109.36. Initial support is seen at 106.75 from a 50-point pivot, which targets 106.25 and 107.25 106.25. The next level is 105.60 from a 50-point pivot that targets 105.10 and 106.10.

Oscillators are rising.

NEAR-TERM: Slightly bullish
MEDIUM-TERM: Mixed
LONG-TERM: Bearish


Sterling/dollar

Sterling/dollar melted sway on Tuesday to surrender most of the gains made in the previous three days despite decent non-housing data. My model went short, but the short-term outlook remains bearish. Key support is at 1.9490. The next level is 1.9460. Below 1.9365, distant support comes at 1.9185. Good resistance now comes at 1.9585. Above 1.9640, there is further resistance at 1.9800.

Oscillators are declining.

NEAR-TERM: Slightly bearish
MEDIUM-TERM: Mixed
LONG-TERM: Mixed


Dollar/Swiss franc

Dollar/Swiss marched higher on Tuesday and erased most of the losses incurred late last week. The short-term outlook remains bullish, but the move is starting to look overdone. Initial resistance now comes at 1.0484. This is followed by 1.0545 and 1.0622. Immediate support is now seen at 1.0340. Below 1.0270 there is support at 1.0150. Distant support remains at 1.0100.

Oscillators are rising.

NEAR-TERM: Mixed to slightly higher
MEDIUM-TERM: Mixed
LONG-TERM: Bearish

Published on  Wed, Jun 11 2008, 06:14 GMT

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