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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 28/08/20

Gold trades weaker after Powell's speech

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The precious metal was trading weaker on Thursday, down about 1.5% intraday at the time of writing. This fully erased the gains made from Wednesday. The declines came following comments from Fed President Powell during the annual Jackson Hole symposium that started on Thursday.

The current declines in Gold prices could see the support level of 1900 being tested once again. This would be critical as a break down below 1900 could potentially open the way for further declines in the precious metal. Below the 1900 level, the next lower support is found only at 1850.

However, to the upside, if there is a rebound we could see price action only drifting sideways. Note the potential descending triangle pattern that is taking shape. This gives the minimum downside to the 1850 level. Therefore, if the pattern is validated, we could see a stronger correction coming in Gold prices.

Crude oil pares gains as Hurricane Laura makes landfall

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WTI Crude oil prices, which initially rose during the week on account of the Hurricane Laura pared gains on Thursday. The declines came as the Hurricane made landfall. It already forced oil producers to shut down operations. Investors are likely in a wait and watch mode to assess the damage from the Hurricane.

For the moment, oil prices are likely on track to decline toward the 42.00 level of support. This level previously held up as resistance. Therefore, establishing support near this level could potentially signal an upside bias building up slowly.

In the event that WTI crude oil fails near this level, then we expect to see further declines. For the moment, the 200-day moving average is likely to act as dynamic support. This could keep oil prices from slipping further below the 41.25 level for the moment.

EURUSD trades flat as USD strength remains questionable

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The euro currency is trading a bit volatile with price action engulfing Wednesday's prices. Still, there is no clear direction which potentially signals that the USD strength is unlikely to remain strong for long. This also puts the bias mixed for the EURUSD.

For the moment, the short term support at 1.1750 remains key. If the euro slips below this level, then we could expect to see declines taking over. It will potentially open the way for the EURUSD to test the 1.1600 level of support next.

To the upside, price action will need to obviously post a new high above the 1.1950 level. Failure to do so could keep the price action biased to the sideways. This means that the sideways range will likely continue to unfold with EURUSD staying steady above the 1.1700 handle.

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