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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 20/09/19

Gold prices muted to Fed decision

Gold 2009

The precious metal was seen trading muted to the FOMC decision on Wednesday. With global market sentiment broadly quiet, the risk appetite has kept the precious metal in check. This potentially limits the upside in gold for the moment.

The precious metal is expected to eventually break low from the resistance level of 1500. However, this needs to be confirmed by a strong break lower. This will confirm a move to the lower support level of 1440. Price action is also seen consolidating near the current levels.

This forms the bearish flag pattern. A breakout from the resistance level will confirm the downside. But watch the Stochastics oscillator which remains near the oversold levels. Therefore, there is a good chance that gold will move to the upside. The gains will hold the upper resistance level of 1522.

Oil prices maintains the downside momentum

WTI 2009

Crude oil prices were seen extending lower for the second consecutive day. However, prices attempted to post a modest rebound to the upside, but the gains were muted. The correction to the rally soon fizzled.

The drone attacks basically cut out 50% of Saudi’s oil production. However Saudi Arabia later reported that most of the production will be back online by the end of this month. This put oil prices back to the downside. At the moment, WTI crude oil prices were seen testing the psychological support level of 58.00.

A breakdown below this level will push oil prices lower down to 56.00 handle. In the medium term, oil prices could continue remaining within the range of 60.50 and 56.00. Unless we see a breakdown from this range, we do not expect to see any major gains or declines.

EURUSD continues to remain strongly range bound

EURUSD 2009

The EURUSD currency pair has been strongly range bound over the past few sessions. Price action is limited to the range of 1.1085 and 1.1004. This marks a narrow range compared to the longer term range.

Given the fact that the EURUSD is seen trading near the lows, there is a chance that the breakout will be strong. A downside breakout will potentially push EURUSD to fresh lows. This could also trigger a longer term decline and the resumption of the downtrend.

To the upside, the resistance level at 1.1111 – 1.1130 will likely keep a lid on the gains. Unless we see a convincing breakout above this level, the EURUSD will remain muted in the coming sessions.

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