5th May, 2011 – Daily Forex Report by GFM Research

The Cable finds support at 1.6450 ranges after three days of correction; against rest of the FX pairs, the Green back traded in narrow range. The U.S Dollar seems to be oversold in short-term; short covering may be seen though there are no signs of short covering; the Dollar Index (DX) is still in bearish trend only daily close above 74.50 would result in USD bottoming out.
The Dow Jones Industrials (DJIA) is trading consistently above the major support of 12620 ranges, DJIA Vs DX correlation suggests weakening of the U.S Dollar though caution is spelt out in case of DJIA as it is entering major resistance zone of 12900-13100. The U.S Dollar seems to be over sold against most of the FX majors and short covering may be witnessed.
NYMEX Crude June basis after facing stiff resistance at $114.00 upper ranges sold off below the critical support of $110.80 and currently trading at $108.90

FX Pair      Support 2   Support 1    Resistance 1    Resistance 2

EURUSD      1.4650         1.4730           1.4890             1.5000
USDJPY        79.70           80.00             81.40              82.40
GBPUSD      1.6350         1.6430           1.6560             1.6600
USDCHF          –              0.8530           0.8630             0.8670
EURJPY       117.90         118.80           120.80             121.60
AUDUSD      1.0590         1.0680           1.0830             1.0900

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Disclaimer: This report contains the views of GFM Research Private Limited. This report should not be construed as investment/trading advice. Due care is taken when gathering the data/information and the data sources are believed to be reliable, though GFM Research Private Limited nor its Group Companies guarantee for the same. Trading/investing in financial markets may result in financial and/or emotional stress, a trader/investor is advised to weigh pros and cons of trading/investing. Further disclaimer will be produced on request.