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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 02/21/20

Gold prices recover after selloff

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The precious metal is making attempts to pare previous losses. After losing the 200-day moving average support, gold is back on the front foot. The gains come largely due to the weakening in the U.S. dollar. It also coincides with a much needed correction on the short term charts.

The current moves to the upside could see gold prices retesting the 1850 handle. Establishing resistance at this level could keep price action in check. It will also keep the downside bias intact at the moment. But this could change if gold rises back above 1850.

As a result, we expect gold prices to remain in a sideways range between 1850 and 1800 for the medium term. Only a strong breakout from either of these levels will trigger the next direction of the trend.

Oil prices weaken after failing to post fresh gains

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Oil prices are trading weaker on Tuesday. The declines come after price action was trading comfortably above the 45.00 level for the past few days. The OPEC meeting is also underway this week. However, so far, the verdict is that OPEC and Russia will not be increasing the production cuts.

On the contrary, the OPEC nations are expected to continue extending the current production cuts by another three months. Lack of any clear bullish news is likely to keep the sentiment in check. Furthermore, the politics of the new U.S. administration which is promising to cut fossil fuels are also likely to add to the bearish sentiment.

For the moment, the current pace of declines could see oil prices eventually testing the 42.00 level of support. It is essential that oil prices hold this support level. Failure to do so could see further declines in the near term.

EURUSD rises to the highest levels since 2018

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The euro currency is posting bullish gains on Tuesday as the U.S. dollar weakened significantly. This comes amid general speculation of more stimulus coming from the Federal Reserve. The collapse of the U.S. dollar is adding to the bullish sentiment in the euro.

The EURUSD had previously failed to breakout above the 1.2000 level of resistance. However, this was not the case this time. Even on Monday, prices fell sharply after testing the 1.2000 handle.

With prices clearing the 1.2000 level, we could expect to see further gains in the making. Any corrections in prices will see the 1.1900 level being tested for support. As long as this level holds, the euro currency is likely to continue to push higher.

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