Daily Market Commentary

The dollar unexpectedly marched higher on Tuesday

Wed, Jul 9 2008, 06:38 GMT
by Cornelius Luca

GFT (Global Forex Trading)


The dollar unexpectedly marched higher on Tuesday after the oil prices fell again and the US stock indices managed to advance. There was little impact from news that the index of pending home re-sales fell 4.7 percent in June following an upwardly revised 7.1 percent gain in April. It’s summer time and the market is very unclear – but the dollar should attempt to pad its gains on Wednesday.


Euro/dollar

Euro/dollar fell on Tuesday, but was stuck in an inside range. My model remains short, which is good since the pair remains below the former rising trendline. Expect choppy trading. Below 1.5635, support remains at 1.5605. The next good level is at 1.5685. Below 1.5630, further support remains at 1.5575. Immediate resistance is still at 1.5735. Above 1.5820, euro/dollar faces key resistance at 1.5905.

Oscillators are mixed.

NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bullish


Dollar/yen

Dollar/yen reversed aggressively on Tuesday, but didn’t break any new ground. Expect more choppy trading today as well. Good resistance remains at 107.95 from a 50-point pivot, which targets 107.45 and 108.45. Initial support is at 107.20. Strong support follows at 106.75 from a 50-point pivot, which targets 106.25 and 107.25.

Oscillators are rising.

NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Mixed


Sterling/dollar

Sterling/dollar fell further on Tuesday, but got stuck in an inside range. My model remains short and the downside bias continues, but choppy trading should continue. Below 1.9710, support is now seen at 1.9605. Distant support remains at 1.9540. Initial resistance is seen at 1.9745. Above 1.9795, cable has resistance is at 1.9865. Distant resistance follows at 1.9908

Oscillators are declining.

NEAR-TERM: Mixed with downside bias
MEDIUM-TERM: Mixed
LONG-TERM: Mixed


Dollar/Swiss franc

Dollar/Swiss rallied to a 1 ½-week high after forming an outside range on Tuesday. Expect further choppy trading, but my model remains long. Above 1.0350, resistance remains at 1.0415 and 1.0450. Distant resistance comes at 1.0540. Initial support is now seen at 1.0305. The next level is 1.0215. Distant support is seen at 1.0166.

Oscillators are rising.

NEAR-TERM: Mixed
MEDIUM-TERM: Mixed
LONG-TERM: Bullish

Published on  Wed, Jul 9 2008, 06:41 GMT

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