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

Gold prices weaker on a firm dollar

XAUUSD 2011

The precious metal is breaking down from its range over the past few days. A rising U.S. dollar and the vaccine hopes are pushing investors to riskier assets. This is making gold prices less attractive for investors. The declines also come amid lack of any new fundamentals in the market.

For the moment, gold prices are testing the 1850 level if the current pace of declines continue. At the moment, price action is trading close to the 1860 level. If prices break down sharply below this level, then we could expect the recent sideways range to break.

It will eventually accelerate the declines once the 1850 level of support is breached. But considering that this level has held up since September, a breakout is likely to happen only driven by strong fundamentals.

Oil trades on the backfoot due to rising Coronavirus cases

WTI 2011

WTI Crude oil is taking a breather as the rising number of Coronavirus cases in the United States is dampening demand outlook once again. At the same time, the rising U.S. dollar is also putting pressure on the commodity. The latest inventory report from the EIA showed that the inventories rose 768,000 barrels last week. This was less than the forecasts of a 1.7 million.

Price action is broadly contained within the highs and lows from Wednesday. However, it is clear that the 42.00 level is proving hard to break at this point in time. Therefore, we could continue to see some consolidation taking place near the current levels.

To the downside, the declines are likely to gather momentum only if oil prices slip below the 40.00 level. A close below this level will then open the way for price action to fall to the 39.00 level where a previous minor resistance level will be tested for support.

Euro slips on rising dollar

EURUSD 2011

The euro currency is posting declines as the Greenback makes an attempt to end its losing streak. The dollar is boosted as rising Coronavirus cases in the U.S. is pushing investors to safety of the greenback. However, the dollar strength is put in check as there is rising speculation that the Federal Reserve could ease in December once again.

With prices reversing near the 1.1850 level, the EURUSD is likely to continue its move lower. For the moment, the 1.1800 level of support will be of interest. If the euro currency loses this psychological support, then we expect to see further declines.

Given that price action is posting a lower high, the bias is certainly to the downside for the moment. But this could change if the euro reverses losses to close above 1.1900 level, which looks unlikely at this point.

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