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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 03/04/20

Gold climbs for second consecutive day

XAUUSD 0304

The market sentiment is slightly improving with gold prices rising for the second consecutive day. This comes following a strong decline from the previous session. However, in the medium term horizon, gold prices remain rather choppy. Unless we see new highs or low forming, this sideways range continues.

After slipping to lows of 1560, price action reclaimed the support/resistance level near 1580. For the moment, the upside highs will be in question. If gold prices breakout above 1620, then we expect that gold prices will possibly make a possible high.

Alternately, we expect gold to maintain a sideways range within the previous big decline between 1620 and 1575 levels. Unless we see a breakout from this range, we do not expect to see further progress in price action.

WTI crude oil jumps over 16%

WTI 0304

The volatility in the crude oil markets continues. Crude oil prices rose over 16% on the day following President Trump’s comments on the oil markets. Trump said that he spoke to Russia and Saudi Arabia and sought for both countries to reach an agreement. According to the statement, OPEC is expected to cut production by 10 million barrels.

For the moment, oil prices are caught within the range of 28.00 and 20.00. We expect prices to trade flat in the near term. The short term trend line which is broken could be retested. This will mean that oil prices will likely pullback lower in the near term.

As long as prices remain above the 20.00 we expect the upside bias to build up. Watch for a strong breakout above 28.00 handle. A move above this level will see a possible upside forming. The next upside target is at 42.00.

Euro slips for the fourth consecutive day

EURUSD 3003

The EURUSD currency pair continues to remain weak to the downside. Price action is in a free fall for the fourth consecutive day. The declines come amid a strength in the U.S. dollar. With the dollar strongly poised to the upside, we expect a possible move lower.

For the moment, EURUSD remains range bound within the levels of 1.1000 and 1.0784 levels. Given the declines now, we expect the euro currency to test the 1.0784 level. The confluence of the support level and the trend line could however offer some support.

This gives the possibility of a rebound in price action in near term, keeping the sideways range intact.

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