Gold, Oil and EURUSD Weekly Analysis - Week 39

Gold posts modest gains as USD weakens

The precious metal is attempting to regain the bullish momentum with price action closing in the green on a weekly basis. Still, price action remains caught within a consolidation near the top end of the rally, with the 1967 support holding up for now.

Meanwhile, the descending triangle pattern was tested once again last week. A breakout above this trend line could confirm a move toward the 2000 level next. This will be a key resistance level that gold prices will need to battle to make further gains.

As a result, the current support area near the 1950 handle could signal a move lower if the support at 1967 fails. Still, the lower support at 1900 might hold up. Unless gold prices break down below the 1900 level we do not expect to see any correction taking place.

Oil prices recover strongly on OPEC comments

Crude oil prices maintained a bullish momentum just after prices fell to a three-month low. The gains pushed oil prices into the green on a weekly basis. Oil prices were bid higher after Saudi oil minister said that he would call for an OPEC meeting in October if oil prices fell further. This, alongside a decline in the U.S. inventories pushed prices higher towards the close of the week.

Price action is now back near the 40.00 level, fully recovering from the slump just a few sessions ago. However, the price level near 40 marks the key resistance level near the 42.00 region. Here, we see the confluence of the horizontal support level alongside the 50 and 200 day moving averages.

A strong breakout above this level is required to confirm the upside. However, given the current scenario, we expect oil prices to remain range bound below the 42.00 region. To the downside, the support level near 36.00 will likely hold as support.

EURUSD remains stuck in a range

The euro currency did not make much gains as prices closed rather flat. The sideways price action comes as the support level near 1.1800 is holding up for the moment. The U.S. dollar strength was also seen wavering after last week's Fed meeting. To the upside, the euro currency will face the resistance near the 1.1900 handle.

Above this level, the next main challenge for the EURUSD will be the 1.2000 handle. A strong breakout above these levels is required to confirm further upside. There is also a risk of a fake breakout once again above 1.2000.

To the downside, the 1.1800 has been established as a strong support. This means that price action will need to break down sharply to confirm further downside. Below the 1.1800 level, the next level of interest is near the 1.1600 level where support is most likely to form.