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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 17/04/20

Are gold prices posting a top?

XAUUSD 1704

The precious metal is seen regaining the losses from the day before. Price action is back trading near the previous highs albeit on an intraday basis, gold prices formed a lower high. This could potentially suggest a possible topping formation being reached. In the near term, if prices stall near the current level we expect a correction.

Watch the price level of 1708.56 which will trigger a move lower. In the event of a daily close below 1708.56, we expect gold prices to post a correction toward the 1640 level. This will mark a retest of this level which previously served as resistance. But a close below 1640 will accelerate further declines.

To the upside, there is scope for gold prices to continue pushing higher. But this will depend on whether price action can break past the current highs of 1724.43. There is scope for gold to potentially test the 1800 level if the bullish momentum prevails.

Is Crude oil forming a potential double bottom?

WTI 1704

Crude oil prices continued their descent in the previous few sessions. As a result, price action is back near the 20.00 level. However, the outlook is for a possible breakout to the upside given the double bottom price action formation. This gives a minimum upside for crude oil toward the 36.00 level.

However, given the current volatility, there is scope for oil prices to continue lower. If prices break past the 20.00 level of support, we expect further declines. This could push oil prices to new lows. Therefore, there needs to be a strong reversal candlestick pattern to emerge near the current lows.

Following the breakout above the resistance level of 28.00, we expect oil prices to continue pushing higher to the eventual 36.00 level of resistance. Following this, further upside could be seen toward the 42.00 level which marks the retest of the previously held support level as resistance.

Euro tumbles under dollar strength

EURUSD 1704

The euro currency is back to giving up the gains made in the previous few sessions. Price action is falling for the second consecutive day, marking the gains in the U.S. dollar. As a result, the EURUSD continues to remain choppy and range bound within the levels of 1.1000 and 1.0784.

Unless we see a reversal near the lower end of this range, the declines could continue. There is already evidence of the downside bias building up given the lower that has formed in prices. Therefore, for now, a breakdown below 1.0784 should see a new lower low forming.

In the absence of this price action, we could expect the continuation of a sideways range to be maintained for the EURUSD currency pair. The Stochastics oscillator is also trading rather flat suggesting that momentum could remain weak.

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