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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 23/06/20

Gold prices showing signs of pushing higher

XAUUSD 2406

The precious metal is on track to post gains for the third consecutive session. This has pushed prices above the upper end of the range at 1730. This was the range that gold prices were stuck in since early April this year. The consolidation within the range continued well into late June with only the recent price action showing signs of an upside breakout.

With the rise in gold prices, we now expect price action to maintain its bullish stance. The upside target of the 1800 psychological level remains within sight at the moment. However, we could anticipate a near term pullback on the prices. Expect prices to retrace back to the breakout level near 1730.

This level is likely to attract more buyers into the market and could therefore turn to support following a few months of serving as resistance. Establishing support at the 1730 level will confirm the upside. Of course, following the pullback, gold prices need to breakout above the current highs in order for a move toward the 1800 level.

WTI crude oil maintains a steady trend

WTI 2406

WTI crude oil prices are rising steadily marking a fourth consecutive day of gains. This comes after prices managed to breakout above the psychological round number resistance level of 40.00. Fundamentally, oil prices also got a boost after US President Trump touted a new trade deal with China. This is seen as the previous tensions soothing between the two countries and gives hope for rising demand for crude oil.

From a technical stand point, oil prices are on track to test the 42 level where resistance will most likely occur. This follows the breakdown below this level in early March this year. Therefore, we expect some profit taking and new sellers entering the market as a reason for a pullback.

To the downside, the declines might be limited. There is evidence of minor support forming at the 35.00 handle. However, considering that this level was not firmly tested previously, we suspect a retest back to this level to establish support ahead of further gains.

EURUSD attempts to recover past losses

EURUSD 2406

The euro currency is rising for the second consecutive day with the gains stronger than the previous declines. Price action reversed direction just a few pips above the 1.1147 level of support, suggesting that the upside might still be in play. However, as the euro approaches the previously formed highs, it will be interesting to see if price can breakout any higher.

For the moment, we have a higher low formed above the 1.1147 level. But in the event that we see a lower high forming at the current levels, it could confirm that a correction is underway. A reversal around the current levels near 1.1340 could see prices falling lower. This will open the way for the EURUSD to fall back to the previous lows.

But this time, price action could potentially test the 1.1147 level ahead of a move to the 1.1000 level of support. A drop to this lower level will confirm the correction as the longer term uptrend still remains in play. However, this view would become invalidated if the euro currency manages to breakout above the 1.1400 handle.

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