26th May, 2011 – Daily Forex Report by GFM Research

The Dollar Index (DXM11) slips again from 76.50 ranges; on the event of weaker than expected economic data, profit taking was witnessed in the dollar long positions. The Cable appreciated the most followed by the Euro and Swiss Franc; the Aussie Dollar also recovered smartly by the end of New York trade after trading in red for most of the Asian and European sessions.
The Dollar Index (DXM11) has reached major resistance zone of 76.50; currently it is trading weak at 75.70; only weekly close above 76.50 would post short-term bottom. On the lower side, 75.00 is expected to act as critical support for Dollar Index (DXM11), weekly close below 74.60 would result in continuation of long-term bearishness of U.S Dollar.
Benchmark equity index of the Dow Jones Industrials (DJIA) recovered smartly from the support zone of 12200 ranges, immediate resistance is seen at 12450 and major trend is expected to establish above 12600; historic correlation between DX and DJIA suggests sideways trend in Dollar Index with weaker Dollar.
NYMEX Crude (CLN11) is trading range bound between $105.00 and $95.00; $95.00 ranges is expected to act as important support and $102.70 is expected to act as immediate resistance.


FX Pair     Support 2       Support 1      Resistance 1      Resistance 2

EURUSD    1.4040            1.4120              1.4260                 1.4350
USDJPY      81.20             81.50                 82.20                  82.70
GBPUSD    1.6190           1.6240               1.6330                 1.6410
USDCHF    0.8550           0.8610               0.8770                 0.8800
EURJPY    114.30            114.70              116.50                 117.00
AUDUSD   1.0410            1.0570              1.0690                 1.0750

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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.