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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 19/07/19

Gold prices stay firm near six year high

Gold 1907

The precious metal was seen posting modest gains by Thursday’s close. Price action turned bullish over the week but price was still seen struggling near the highs of 1420. This level has seen a lot of consolidation which could continue in the near term.

However, if gold breaks out above 1420 handle we anticipate further gains in store. Given the ascending triangle pattern that has formed, gold prices could be pushing higher to a minimum of 1450 in such an event.

The gains would however need to be validated by the fundamentals. Given the fact that the markets will be waiting for some big events next week such as the ECB meeting and the U.S. advance GDP report, it is likely that gold prices will stay flat near 1420 levels.

WTI Crude oil posts strong declines

WTI 1907

Crude oil prices were seen dropping sharply for the most part of the week. Oil prices dropped for four consecutive days so far after failing to break past the resistance area of 60.64.

The strong declines came about amid increase in oil inventories from the weekly EIA’s report. From a technical perspective, oil broke past the 57.50 level of support. This puts oil prices on target to test the 54.00 level where the next support exists.

In the near term, any rebound in prices will likely see the 57.50 level turning in as resistance. This would put a cap any gains in oil prices. But if the resistance level fails, then we could expect to see prices recovering in the medium term.

EURUSD turns flat at support

EURUSD 1907

The currency pair was seen struggling to lift off the support area. The support area was formed at 1.1224 – 1.1200 level in the near term. Price action has formed a potentially bearish head and shoulders pattern.

 A breakout down below the neckline support could trigger potential declines in prices. If the currency pair breaks the support, the downside target opens up to 1.1100 at the very minimum with further declines likely.

Alternately, a rebound off this support level could keep the EURUSD biased to the upside. This will put the currency pair back within the range of 1.1395 – 1.1200 region.

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