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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 07/08/19

Gold, on track to hit $1500

Gold 0708

The precious metal managed to regain strong momentum since the start of the week. The gains came following the escalating trade wars with the United States and China. This saw China responding by de-valuing the Chinese yuan currency.

The escalating tensions saw investors flooding to safe haven assets and thus boosted gold prices higher. The gains in gold prices comes amid the ascending triangle pattern that has been validated. On the contrary, the ascending wedge pattern which was bearish became invalidated.

The currently valid ascending triangle pattern puts the upside to about $1500. This will potentially be the minimum target if the current bullish momentum is maintained. Any declines in the short term will see the breached resistance level of 1440 being tested.

Watch the descending triangle pattern in Crude oil

WTI 0708

Crude oil prices have been trading somewhat flat over the past few weeks. Price action has been bouncing off the various levels but the downside momentum looks to be entrenched given the lack of any higher highs being formed in price.

Over the course, WTI crude oil has formed as descending triangle pattern. The support level near 56.00 has been formed. This level held steady for a while, leading to a lower high being formed. Following the breakout from this level, the minimum downside target in crude oil is about the $52.00 level.

But given the slowing momentum, there is a risk that price could reverse before reaching the downside target. Having said that, establishing support near the 52 region will potentially keep crude oil prices to make the correction ahead of further direction in the trend being established.

EURUSD still within the range


The currency pair managed to get a boost due to the weaker U.S. dollar over the past few days. The USD weakened following the escalating trade wars and a devalued Chinese yuan. The fundamentals for the moment, shift to the USD especially after Trump labelling China as a currency manipulator.

Technically, the EURUSD remains trading within the range. The recent weakness in the USD helped the currency pair to test the highs of 1.1200 but the common currency was seen giving back the gains rather quickly.

Price action is currently trading in the resistance area of 1.1224 – 1.1200 region. As long as this resistance holds, the currency pair could be seen slipping back to the support area of 1.1129 – 1.1111 level. The overall range in the EURUSD remains flat for the moment. The downside however looks to be done.

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