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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 08/03/19

Gold settles into a range

Gold 0803

Gold prices were seen maintaining the range between 1290 and 1281.50 over the past few days. Price action remained muted following the strong declines since late last week. Overall, the price action indicates that gold is likely to wait for a catalyst ahead of deciding the next leg in its direction.

To the upside, a breakout above 1290 will accelerate the gains to the 1300 -1305 mark initially. If resistance is established here, we could expect to see further declines coming through with another retest to the 1280 handle.

Alternately, if the resistance area between 1305 - 1300 gives way, then gold prices could be looking to post a deeper retracement to the 1320 region. The bias remains balanced at the moment and the breakout direction is likely to determine the next move in gold prices. For the moment, the support at 1280 looks to be fairly strong, holding out further declines.

WTI consolidating near 56

WTI 0803

WTI Crude oil prices have remained caught in a range, after a brief decline to 55.50 saw prices reversing direction. For the moment, the bias remains flat and the momentum is to the upside. However, as long as the level near 56 - 57 holds, oil prices are unlikely to post further gains.

Watch the area between 57.00 - 57.50 which remains a strong resistance level. One aspect of the current price action being that oil prices are consolidating into an ascending triangle pattern. Therefore, a breakout above the resistance level of 57.00 - 57.50 could trigger further gains.

The next upside target in such an event would be seen at 60.00 handle. But in the event that oil prices fail to break the resistance, we expect prices toe eventually decline and likely to test the support at 54.00 level.

EURUSD slumps to the downside

EURUSD 0803

Following a rather large period of consolidation, the EURUSD currency pair is seen extending the declines lower. After breaking the support level of 1.1312 - 1.1282, the common currency is seen extending strong declines. The next lower support is seen at 1.1200 level which could be tested in the near term.

The downside bias is also validated by the fact that the lower trend line has been breached. A breach of this trend line suggests that the common currency will need to establish support near the 1.1200 level. The declines remain limited to this level for the moment.

Following the decline, we expect the common currency to maintain its range once again. Overall, the EURUSD remains trading flat within the 1.1450 and 1.1200 level.

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