31st May, 2011 – Daily Forex Report by GFM Research

The Dollar Index (DXM11) after finding resistance at 76.50 ranges slipped below critical support of 75.00 ranges. Long-term bearishness in the Dollar seems to be back; consistent close below 74.50 would increase our conviction.

Key equity index of the Dow Jones Industrials (DJIA) has taken support at 12200 ranges; the trend is sideways capped between 12200 and 12600; consistent close above 12600 would resume bull trend in the Dow. Historic correlation between DJIA Vs DX suggests sideways trend in the USD with weaker bias.
NYMEX Crude July basis is trading tight between $102.70 and $99.00 with $95 expected to act as important support; daily close above 102.70 would establish bull trend.

FX Pair        Support 2       Support 1         Resistance 1         Resistance 2

EURUSD          1.4210              1.4280               1.4490                  1.4540
USDJPY            80.20                80.70                 82.00                    82.70
GBPUSD          1.6360              1.6440                1.6580                  1.6660
USDCHF               –                  0.8400                0.8550                  0.8630
EURJPY           114.70              115.30                117.00                  117.70
AUDUSD          1.0620              1.0660                1.0800                  1.0840

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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.