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Gold, Oil and EURUSD Weekly Analysis - Week 26

Gold rises to new six-year highs

Gold 2406

Gold prices continued to maintain the bullish momentum as price action tested new six year highs on an intraday basis. By Friday’s close, gold prices settled modestly back at $1398.00.

The gains in the gold prices now marks five consecutive weekly gains. The upside bias is likely to be maintained in the near term with further gains likely. The next main upside target will be the 1400 level which was briefly tested last week.

A pullback is likely as gold prices could be seen establishing support in the near term. The 1360 handle is most likely where gold could establish support. A rebound off this level could keep the bullish momentum going. In the event of a pullback that is deeper, then gold prices could fall back to the 1320 handle where the next support level is likely to form.

WTI crude oil settles near resistance

WTI 2406

WTI Crude oil prices were seen trading near the resistance level of 57.50 by Friday’s close. The strong gains in oil prices saw the commodity rising as much as 9% over the course of the week.

With price action now at the expected resistance level, there is scope for oil prices to post a modest correction. It is still too early to tell if the bias has shifted to the upside. Oil prices haven’t tested the 50.00 technical support. Therefore, in the event of a correction, we could expect to see some near term declines.

Initial support is seen at the 54.00 handle. Oil prices could be seen testing this level in the near term. A rebound off the 54.00 handle could signal a bullish reversal in price action. Following this, oil could breach the 57.50 resistance and continue higher to test the 60 level.

Euro advances gains above 1.1300

EURUSD 2406

The common currency managed to capitalize on a weaker USD. By Friday’s close, the EURUSD closed at a three-month high, reclaiming the $1.1300 technical level. However, the gains in the EURUSD still remain doubtful.

The currency pair is seen trading in a sideways range for the most part. Thus, the EURUSD will have to break out above 1.1400 level to confirm the upside bias. This comes as the currency pair approaches the level currently. There is scope for price to reverse course near this resistance level.

To the downside, the support level formed at 1.1224 – 1.1200 could very well serve as support once again. In the short term, the EURUSD could be seen maintaining a sideways range.

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