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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 02/09/20

Gold prices stuck below 2000


The precious metal is trading on a cautious note as price action continues to remain well below the key 2000 level of resistance. As a result, we see lower high forming. If prices reverse lower from here, this will potentially confirm that the uptrend in gold prices might be coming to an end. Of course, the support level near 1900 will be critical and the downtrend can be confirmed only on a close below this level.

The pace of gains in the precious metal however remains soft, unlike the solid gains seen in the weeks before. For the upside to continue, gold prices need to clear the 2000 level, which remains a bit doubtful at the moment.

However, given the current set up, we anticipate gold prices to remain range bound within the 2000 and 1900 levels. A breakout from these levels can confirm the direction of the trend at least for the short term. Keep an eye on the Stochastics oscillator which could potentially signal a downward momentum

Oil price consolidation continues

WTI 0209

Crude oil prices are trading modestly bullish but overall price action still remains weak. The sideways range within 45 and 40 remains steady for over two months now. Even the recent drop in the US dollar has failed to push oil prices higher. The consolidation reflects the current market sentiment which remains mixed amid concerns of economies reopening after the pandemic.

For the moment, the support level near the 42.00 region should keep oil prices from falling further. But a close below this level could signal a move toward the 200-day and the 50-day moving average. The rather straight lines from the moving averages also indicator the strong consolidation in the oil markets.

As a result, there is a possibility that crude oil could potentially breakout in the medium-term outlook. The bias remains mixed for the moment. However, the breakout could likely see prices moving in either direction that could set the trend for the next leg in the oil markets.

EURUSD eases from a new two-year high


The euro currency marked another milestone as price action briefly tested 1.2000 handle for the first time in two years. But price action pulled back quickly after testing this level. Further to this, there is a bearish divergence building up for the EURUSD that could suggest a near term correction.

Watch the 1.1800 level of support at the moment. If the EURUSD loses this handle, then we could see price action pulling back further. This could mean that the common currency will potentially post a correction, with the lower support level near 1.1600.

However, given the current weakness in the US dollar, the euro currency could establish support near 1.1800 before resuming the uptrend. In the near term, if the EURUSD fails to breakout above 1.2000 handle, then we could see the bearish bias building up.

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