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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 11/12/20

Gold prices remain muted

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The precious metal is not making any major gains or losses after settling above the 1850 handle. The gains came early on in the week after the U.S. dollar fell to a new two and half year lows. Following the move above the 1850 levels, gold prices have turned flat.

Expectations that the vaccines will lead to an economic recovery is putting downside pressure on gold. If the precious metal fails to test the 1900 level or break out higher, then we could expect to see further declines eventually.

This would mean that if gold loses the 1850 level of support, they would be heading back to the psychological round number support near 1800. This where we also see the 200-day moving average holding ground for the moment.

WTI Crude oil bounces on demand hopes

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Oil prices are making a modest rebound after days of consolidating near the 45.00 levels. The rebound comes after expectations that demand for crude oil will rise as the vaccines roll out. Furthermore, some oilfields in Iraq also came under attacked, leading to a modest bump in prices.

For the moment, oil prices have firmly established support near the 45.00 level. Prices are making a modest attempt to push for higher highs. If this is confirmed on a daily basis, then we expect to see new highs forming.

Failure to make any new gains could however put the 45.00 level under stress once again. This could potentially see the support level breaking away, which in turn could lead to lower prices eventually. To the upside, the next key level is near the 50.00.

ECB expands bond purchases, hints at exchange rate

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The European Central Bank held its monetary policy meeting on Thursday. The euro currency was trading mixed slightly weaker ahead of the meeting. The ECB, as expected expanded its bond purchases by 500 billion euros. The central bank also signaled that it was keeping a close watch on the exchange rate.

Ahead of the meeting, the EURUSD was seeing descending from the 1.2100 highs. As price action continued to trade soft, the ECB meeting gave a boost to the common currency, which managed to make a modest bounce.

However, overall we expect price action to remain volatile near the current highs above the 1.2100 levels. It is possible that the 1.2000 level of support could be tested in the near term.

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