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Gold, Oil and EURUSD Weekly Analysis - Week 43

Gold remains trading in a tight range


The precious metal closed on Friday in the red, but the pace of declines was relatively muted. This price action follows the pattern over the last three sessions. Gold prices are relatively stuck between the falling trend line and the 1900 area which has seen a lot of consolidation.

The 50-day moving average is also coming in as a strong support/resistance level leaving prices to trading flat rather than post any direction. The stochastics oscillator is showing a possible change in the trend. This could mean that gold prices might break out to the upside.

Such a move will potentially weaken the downside bias. It will also invalidate the descending triangle pattern that has emerged over the past few months. Therefore, watch for a potential breakout of the trend line which will confirm the move higher.

Oil prices firmly stuck near the 50 and 200-day MA

WTI 1910

WTI Crude oil prices continue to head nowhere, with another week closing near the key price levels of the 50-day and the 200-day moving average lines. This consolidation near the 42 - 41 level continues to put oil markets in a strongly flat market with price action practically doing nothing.

The stochastics oscillator is once again trading near the overbought levels. This could potentially see another modest pullback in price action. The lower end of the range has been firmly established near the 36.70 level where any declines might find support once again.

On a weekly basis, oil prices have closed on a flat, but a modestly bullish note. This comes following the gains made from the week before. Still, with price action unable to breakout above the 42 region, we could see another ranging session to continue.

EURUSD closes on Friday with modest gains


The euro currency managed to close in the green on Friday amid a week that saw prices falling consistently. The gains, comparing to the losses remain largely muted with the 50-day moving average rejecting the intraday gains made. With the stochastics oscillator turning lower, there might be further room for the euro to fall.

This will potentially open the way for a decline to the 1.1600 level which is yet to see a firm retest of support. The dollar strength in the mean time is also at risk with markets trading quite choppy over the past few weeks.

For the moment, the EURUSD bias is to the downside. But this could change as price action is trading flat at the moment and the bias remains mixed for the moment. Watch for a close above the 1.1800 level for confirmation of any gains.

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