Dollar fell versus the majors, but rallied against the commodity currencies on Wednesday

Thu, Apr 10 2008, 07:14 GMT
by Cornelius Luca

Global Forex Trading

The dollar fell versus the majors, but rallied against the commodity currencies on Wednesday. On Thursday the Bank of England should cut rates, but this should be priced in – if it doesn’t cable should rally further. The dollar should see weakness today.

Euro/dollar

Euro/dollar surged to a new high on demand for EUR/GBP. My model turned long, and the overbought pair may still climb up today. Initial resistance now comes at 1.5904. The next level is 1.5945. Distant resistance looms at 1.6160 . Immediate support is at 1.5780. Below 1.5675, euro/dollar has distant support at 1.5540.

Oscillators are mixed.

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

Dollar/yen

Dollar/yen finally fell on Wednesday but remained stuck in an inside range. My model remains (barely) long. The key level remains 102.30. Initial support is at 101.50. This is followed by 101.25 from a 50-point pivot, which targets 100.75 and 101.75. Immediate resistance is at 102.30 from a 50-point pivot, which targets 101.80 and 102.80. Above 102.95, the next level is at 103.40 from a 50-point pivot, which targets 102.90 and 103.90.

Oscillators are mixed.

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

Sterling/dollar

Sterling/dollar reversed from a 1 ½-month low to save less than half of Tuesday’s losses. The selling pressure should continue into the BoE action. If it doesn’t cut, cable will explode higher. My model is still short. Initial resistance is at 1.9790. Above 1.9825 there is further resistance at 1.9880. This is followed by 1.9990. Immediate support is now seen at 1.9690. This is followed by 1.9615. Below 1.9585, distant support is at 1.9420.

Oscillators are falling.

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

Dollar/Swiss franc

Dollar/Swiss fell to an eight-day low. My model remains barely long. Watch the support at .9976 for the next direction. Immediate now comes at .9975. The next support is at 0.9875. This is followed by 0.9750. Initial resistance is now seen at 1.0110. This is followed by 1.00180 and 1.0251.

Oscillators are mixed.

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