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Daily Forex Market Commentary for October 4, 2006

GFT Daily Forex Market Commentary for October 4, 2006
By: Cornelius Luca, currencies analyst, GFT


The dollar traded on cue on Tuesday, experiencing some early weakness and then turning higher. The US currency should attempt to extend its upmove today.

Euro/dollar
Euro/dollar reversed early gains, as expected, to close lower on Tuesday. It should head further down today.

Below the area between 1.2710 and 1.2700, support remains seen at 1.2675. Distant support is at 1.2630.

There is immediate resistance at 1.2760 and the euro/dollar will probably hold below it at least on a closing basis. If not, look for a further upmove to 1.2795. Further resistance remains at 1.2830.

Oscillators are mixed.

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

Dollar/yen
Dollar/yen reversed from a three-day low of 117.36 to recoup more than half the losses encountered the previous day. It should see more strength today.

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 comes between 117.35 and 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 to slightly bullish
MEDIUM-TERM: Mixed to slightly bullish
LONG-TERM: Bearish

Sterling/dollar
After rallying sharply on Monday, sterling/dollar only consolidated quietly in a tight range to close virtually unchanged. The outlook remains mildly negative.

Good support remains at 1.8800. That??™s followed by 1.8715 and 1.8675. There is a pivot at 1.8635.

Initial resistance is still seen at 1.8910. Above 1.8975 distant resistance is at 1.9055.

Oscillators are mixed.

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

Dollar/Swiss franc
Dollar/Swiss struggled higher after sinking a day earlier and remained well within an inside range. It should attempt chipping away at more losses today.

Above 1.2455, dollar/Swiss franc retains resistance at 1.2500. Distant resistance is at 1.2620.

Below 1.2400, the pair has support at 1.2350. The next level comes at 1.2290.

Oscillators are mixed.

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

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