2nd June, 2011 – Daily Forex Report by GFM Research

Weaker than expected employment numbers resulted in deep correction in the equity bourses, especially the Dow Jones Industrials (DJIA) resulting in short covering in the Dollar Index (DXM11).

Key equity index of the Dow Jones Industrials (DJIA) in trending sideways capped between 12200 and 12600; consistent close above 12600 would resume bull trend in the Dow, in contrary consistent close below 12200 ranges would result in deeper correction to 11600 ranges. Historic correlation between DJIA Vs DX suggests sideways trend in the USD with weaker bias though 73.40 in DXM11 is expected to act as important support.
NYMEX Crude July basis after trading tight between $102.70 and $99.00 broke out $102.70 but unable to hold above $102.00 closed weaker to trade currently at $99.46. The major trend still remains range bound between $95.00 and $105.00


FX Pair      Support 2        Support 1          Resistance 1         Resistance 2


EURUSD         1.4240              1.4300                1.4470                  1.4507
USDJPY           80.20                80.70                  82.00                    82.70
GBPUSD         1.6250              1.6300                 1.6420                  1.6500
USDCHF              –                   0.8400                0.8550                  0.8630
EURJPY          114.70               115.60                117.00                  118.00
AUDUSD         1.0440               1.0510                1.0670                  1.0820


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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.