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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 12/04/19

Gold erases two day gain

EURUSD 1204

Gold prices reversed the bullish moment on Thursday as price fell sharply on the day.  The declines a day after the Fed minutes were released. Although the minutes were not hawkish, the mention about officials staying open to rate hikes if the economy warranted saw gold prices easing.

From a technical perspective, the bias to the downside once again gathers momentum. However, a lot will depend on how gold will react to the 1285 handle where support is firmly established. Only a breakout below this level will convince fresh sellers into the markets.

In the near term, we expect gold to remain somewhat range bound with the potential of a pullback toward the 1300 mark in the near term.

Is Crude oil posting a correction?

WTI 1204

That remains the big question on everyone’s mind. Prices were seen falling over 1% on Thursday and this reversal comes just a few ticks below the $65.00 handle that we have been watching. However, we expect the current correction to be limited.

The support is seen at 61.80 which has previously served as short term support level ahead of the gains to the 64 handle. As a result, a retest of this level could mark a potential move to the upside. However, there is a chance for oil prices to extend declines even further.

A lot will therefore depend on how price action behaves around the 61.80 region. In the near term, the gains to the upside are limited unless oil prices can post a strong rebound.

 

Euro gives back ECB led gains


WTI 1204

The euro currency was seen giving up the meagre gains made earlier in the week. Price action turned bearish on Thursday although the Wednesday’s intraday lows are yet to be tested. In the near term, it is likely that the EURUSD has once again resumed a somewhat sideways trading pattern.

Watch the support level of 1.1240 which previously held up against the ECB’s declines on Wednesday. As long as this support holds, the EURUSD could be on track to post gains. However, a break down below 1.1240 support will see price action falling sharply.

The lower target in case of a close below 1.1240 will see the EURUSD extending the declines to the 1.1224 region which marks the familiar support level. With no trend in sight, the common currency is likely to maintain its sideways range.

EURUSD 1204

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