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Daily Forex Market Commentary for October 2, 2006

GFT Daily Forex Commentary for October 2, 2006
Forex Market Commentary by Cornelius Luca, currencies analyst, Global Forex Trading


The dollar rallied further across the board on Friday to end on a strong note. But it gave back most of its gains versus the European currencies and this suggests initial weakness at the start of the fourth quarter.

Euro/dollar
Euro/dollar traded fell to an 11-day low on Friday before recovering most of these losses. This suggests a bounce on Monday
Immediate resistance is now seen at 1.2730. Above 1.2785 there is resistance at 1.2830.
Below 1.2660 support remains at 1.2630. Distant support is at 1.2515.
Oscillators are mixed.

NEAR-TERM: Mixed to slightly lower
MEDIUM-TERM: Mixed to slightly lower
LONG-TERM: Bullish

Dollar/yen
Dollar/yen rallied further on Friday as well but held below 118.25. The upside looks capped for now.

Key resistance remains at 118.25 from another 50-point pivot that targets 117.75 and 118.75. Distant resistance is still seen in the 119.10 area.

Immediate support is at 117.75. There is a Fibonacci retracement level at 117.25. The key support today is at 116.85 from a 50-point pivot, which targets 116.35 and 117.35. That??™s followed by 116.06.

Oscillators are rising.

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

Sterling/dollar
Sterling/dollar sank further to an 18-day low on Friday, but then managed to recoup most of its losses. The outlook remains mildly negative, but in the short term it should go up.

Initial resistance is seen at 1.8770. Above 1.8800 resistance comes at 1.8860. Distant resistance is at 1.8910.

Immediate support is at 1.8685. That??™s followed by two pivots at 1.8635 and 1.8605.

Oscillators are declining.

NEAR-TERM: Mixed to slightly higher
MEDIUM-TERM: Slightly bearish
LONG-TERM: Bullish

Dollar/Swiss franc
Dollar/Swiss climbed further up on Friday, as expected, and hit a 10-day high before gave back most of its gains. It should head lower on Monday.

Below 1.2460, the pair has support at 1.2400. The next level comes at 1.2350.

Above 1.2430, dollar/Swiss franc has resistance at 1.2500. Distant resistance is at 1.2620.

Oscillators are rising.

NEAR-TERM: Mixed to slightly bearish
MEDIUM-TERM: Mixed to slightly bullish
LONG-TERM: Bearish

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