GFT Daily Market Commentary

The confluence of geopolitical and systemic risk, and sinking stocks hurt the dollar on Friday. On Sunday, the Treasury and Federal Reserve produced sweeping steps to support Fannie Mae and Freddie Mac and attempt to avoid a potential meltdown in global financial markets. The Fed said both companies could access its discount window for emergency cash and the Treasury said that it would temporarily increase its line of credit to them, as well as purchase equity in them, if necessary.  Expect a choppy recovery of the dollar on Monday, but keep an eye on the shaky S&P 500.  

Euro/dollar

Euro/dollar rallied on Friday to a 2 ½-month and my model remains long. But on Sunday it turned south, and the short-term outlook is cautiously bearish.
 
Below 1.5860, support is now at 1.5740. The next good level is at 1.5685. Distant support is 1.5630. 
 
Immediate resistance is seen at 1.5970. A pivot high follows at 1.6020.  Above 1.6055, euro/dollar faces resistance at 1.6135. 
 
Oscillators are rising.

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

Dollar/yen

Dollar/yen made melted early on Friday but then trimmed losses and then edged higher. Expect choppy trading.

Immediate resistance is 106.75 from a 50-point pivot, which targets 106.25 and 107.25. Distant resistance still comes at 107.95 from a 50-point pivot, which targets 107.45 and 108.45. 

Initial support is at 105.90. Strong support remains at 105.60 from a 50-point pivot that targets 105.10 and 106.10. Distant support is at 104.50 from another 50-point pivot, which targets 104.00 and 105.00. 
 
Oscillators are mixed.

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

Sterling/dollar

Sterling/dollar surged on Friday and my model went long. It tested the trendline declining since November, so it should edge lower today.

Immediate support is at 1.9800. Below 1.9785, support is now seen at 1.9745 and 1.9710.  These are followed by 1.9605. Distant support remains at 1.9560.
 
Initial resistance now comes at 1.9885. This is followed by 1.9917 and 1.9957.  The next level is 2.0005.

Oscillators are mixed.

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

Dollar/Swiss franc

Dollar/Swiss fell to a one-week low on Friday amid the crisis in Iran. Thus, the bearish reversal formation from Wednesday finally came into play. My model went short, but the support from the trendline rising since March 17 held, so the upside should now be probed. Only a close below 1.0113 would signal a more sustainable decline.
 
Immediate resistance is at 1.0215. Above 1.0325, resistance remains at 1.0415 and 1.0450. This is followed by 1.0540.
 
In initial support is at 1.0135.  Below 1.0113, support is seen at 1.0065 and .9996.
 
Oscillators are declining.

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