Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 02/10/20

Gold attempts to breakout above 1900


The precious metal resumed its bullish momentum with prices turning higher on the day. The precious metal is up over 1% on the day following a bearish close on Wednesday. The gains come as investors hope that the U.S. government will announce new stimulus measures. For the moment, the talks are stalled but an announcement is likely to happen with further fiscal measures.

Technically, this could push gold prices higher. However, with price action stuck near the 50-day moving average, it could be quite a struggle. The weekly payrolls report could provide the catalyst. Failure to breakout above the 50-day moving average could signal further gains.

Alternately, to the downside, price action could remain range bound within the 1900 region and the 1850 levels. A downside breakout from here could open the way for gold prices to fall further. The next main support level is seen near the 1750 handle, where there is also a confluence with the 200-day moving average.

WTI Crude oil drops sharply on OPEC output

WTI 0210

Oil prices resumed the bearish momentum on Thursday as price fell nearly 5% intraday. The declines come as OPEC reported an uptick in production. The main production gains came on the back of Iranian oil. Total OPEC output in September rose by 160,000 barrels per day from a month ago in August. Besides Iran, output also increased on the back of production from Libya.

For the moment, the outlook remains bearish with price action reversing gains following the failure to breakout above the 40.00 handle. To the downside, if the declines continue, we could expect prices to fall to the previous lows near 36.00.

If price action falls below the 36.00 level, then it would potentially open the declines toward the 32 - 30 region. However, the move to this level will mark a healthy correction within the broader trend. Prices have hit a horizontal resistance level near 42.00 and unless we see strong support emerging near the lows, we could see price gains being capped at this level.

EURUSD rises higher amid a weaker Greenback


The common currency is posting modest gains but price action remains limited to the open prices from Wednesday. There is also a consolidation building up near the 50-day moving average currently. The gains in the euro comes as the U.S. dollar is seen easing following speculation of further stimulus.

For the moment, the EURUSD is supported as price action reversed declines just above the 1.1600 level of support. To the upside, the EURUSD will need to breakout above the 1.1800 level first to test the 1.1900 region next. A breakout above 1.1900 could open the way for further gains.

We could also expect the EURUSD to potentially rise to new highs if the 1.1900 level of resistance can be breached. But to the downside, failure to breakout above 1.1900 could mean that the EURUSD will fall back to the 1.1600 level. A break down below this support will mean a move to the 1.1374 level where we see a confluence with the 200-day moving average.

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