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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 13/11/20

Gold prices steady near 1850 handle

EURUSD 1311

The precious metal is attempting to make a modest recovery following the sell off from earlier in the week. As a result, price action is trading flat however, supported by the 1850 level. The rebound in the gold prices come as the initial euphoria following the announcement of the COVID-19 vaccine begins to fade. Furthermore, questions about The US election results also weigh on investors’ minds.

For the moment, gold prices are trading above the 1850 level of support. However, we see a sideways range forming with the upper resistance near the 1900 level holding out for the moment. This means that gold prices will trade in a tight sideways range for the near term.

This sideways range could potentially result in a breakout in the near term. The bias remains mixed for the moment however, there is a strong inclination for a move to the downside. Therefore, watch how prices react when they reach the 1850 level once again. Failure to make any new highs could also be an indication of the downside risks building up.

Crude oil prices hold steady near 41

WTI 1311

Oil prices are attempting to make a modest rebound to recover the minor losses from Wednesday. Price action is steady trading near the 41 handle for the moment. Earlier in the day, the Energy Information Administration released a new report noting that the development of the COVID-19 vaccine would not help to lift the demand for crude oil.

Oil traders are ignoring the news for the moment as price action continues to consolidate near the key resistance level of 41. However, we need to see a strong breakout occurring near this level. Failure to make any new highs could potentially signal another move to the downside. We already see a strong confluence of the 50 day and the 200 day moving averages.

However, oil prices will eventually need to retest the 36.15 price level. This will put oil prices back within the long-term sideways range that it has been trading in for the past couple of months. As the consolidation continues, the bias to the upside continues to weaken. This will only mean that crude oil prices might be looking for a short-term pullback once again.

EURUSD pares losses, but trend remains flat

EURUSD 1311

The euro currency is hoping to make some gains in an effort to pare losses from Wednesday. After initially falling to the 50 day moving average, price action is making a strong rebound after prices were rejected near this level. However, the common currency is yet to make any significant moves to convince that the upside trend is still intact.

This sideways movement in the markets come as the US dollar is also pulling back following the initial gains from earlier in the week. For the moment, the EURUSD has established the resistance level near the 1.1900 level. Failure to break out above this level could keep prices pressure to the downside.

However, as we have seen the comma the 50 day moving average is likely to keep a lid on the declines for the moment. But in the event that the common currency loses this handle, then we could expect to see the 1.1600 level being tested. Given the fact that this support area was never tested fully in the past, there is a serious risk of a move lower.

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