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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 21/08/19

Gold attempts a modest rebound

Gold 2108

The precious metal was seen paring losses after falling for two consecutive days. The declines in the precious metal came as investors were seen digesting the negative news about the economy. The fears of a recession were likely overdone as risk appetite grew back. This led to safe haven instruments such as gold losing its shine.

The current rebound in gold is likely to be limited. As long as the previous highs are not breached, we expect to see the gains stalling at or close to the current levels. With minor support forming at Tuesday’s opening price of 1495, watch for this level.

A daily close below 1495 will potentially accelerate declines further. The main support is seen at 1440.00. A retest of this level will mark the support level being established. For the moment, the downside looks to be limited to the 1440 handle. Further declines could come in if the support at 1440 gives way.

Crude oil turns flat ahead of inventory report

WTI 2108

Oil prices were seen trading flat on Tuesday ahead of today’s inventory report. Price action rallied back to test the breached support level at 56.00. With resistance likely to form here, there is a possibility that oil prices could see some downside.

However, the direction remains on how prices will react to the inventory report. U.S. crude oil inventories have seen a mixed report with a few weeks showing a build-up of inventory and a few weekly reports showing a drawdown. The current economic situation also remains somewhat mixed. This clouds the outlook for oil demand.

Technically, if the resistance area of 56.00 holds, then oil prices could once again be looking to the downside. The lower support at 54.00 will once again come into the picture. A breakdown below this support level will push oil prices lower to the 50 handle.

Euro looking to rebound off the lows

EURUSD 2108

The euro currency was seen posting some modest gains on Tuesday. This comes as the common currency is trading near a two-week low and remains close to the historic lows near the 1.1060 region. Resistance to the upside is seen at 1.1129 – 1.1111.

If the resistance fails to hold, then the euro could be seen rising further. This would once again bring the currency pair into the range with the next resistance level holding further gains. However, if the resistance area at 1.1129 – 1.1111 holds, then the EURUSD could be looking at posting further declines.

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