Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 11/12/19

Gold trades flat ahead of Fed meeting

The precious metal was seen trading flat albeit posting some modest gains over the past two days. However, the price action indicates that investors are likely waiting for the Fed meeting amid other narratives to determine the direction in the safe haven asset.

The precious metal is testing the support area of 1462 region at the time of writing. A breakdown below this level will push gold prices down to the support region of 1440. We expect that price action will remain confined above this level in the near term.

Depending on the outcome of the Fed meeting on Wednesday, we expect gold prices to potentially breakout from its range. The bias remains to the downside, although there is scope for XAUUSD to move to the upside. In this scenario, gold prices could likely retest the resistance level of 1497.

WTI crude oil likely settling into a range

Crude oil prices have remained relatively stable after last week’s OPEC meeting. However, the weekly crude oil inventory report is due later in the week. With last week’s inventory report giving a boost, oil prices are likely to react to the report later in the week.

The bias remains to the upside with the bullish momentum intact. The resistance level of 60.60 remains the key target for the moment. Unless prices breakout above 60.60 – 63.00, we expect to see prices drifting sideways.

Overall, the range remains flat for oil prices. With a lot of key events lined up over the week including the U.S. tariff hikes on Chinese goods over the week, oil prices could see some volatility building up as a result.

Euro gains as the dollar remains on the backfoot

The euro currency posted modest gains over the week, largely as a result of the USD trading weaker. The gains come a mix of some positive news as well. The ZEW economic sentiment index turned out higher than forecast. This was the first time the index turned positive in six months.

But prices are still trading lower than the resistance level of 1.1111 level. We expect that this resistance level will be tested before we get a direction in the near term. The bias remains to the downside for the moment. This will keep the currency pair trading flat.

The lower support at 1.1000 remains a key level of interest. As long as this support holds, the sideways price action remains key. A strong breakout from the range will trigger the next direction in the trend.