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Gold, WTI Crude oil and EURUSD - Intra week technical outlook, 31/07/19

Gold holds steady ahead of Fed meeting

Gold 3107

The precious metal has been rallying for two consecutive days so far, although it still remains off the previous week’s highs. Price action remains muted for the moment and it is likely that gold prices will stay flat ahead of tomorrow’s Fed meeting.

From a technical perspective, XAUUSD has scope to the upside with a possible test of the 1440 level. Establishing resistance at this level could potentially push gold prices lower. Given the strong gains in gold prices, the correction to the long term trend is still pending.

A breakdown below 1420 following a reversal near the 1440 handle will give impetus to the downside. The next lower support is seen at 1360 handle. Alternately, there is scope for gold to push higher. A breakout above 1440 will signal further gains as gold prices could likely test the 1450 levels and higher.

Oil prices retests resistance level

WTI 3107

WTI Crude oil prices have been retesting the resistance area of 57.50 level on Tuesday. This comes after prices have bottomed out temporarily. However, failure to breakout above 57.50 could keep oil prices turning flat in the near term.

The medium term trend in oil prices remains flat within the 57.50 and 54.00 levels. With today’s Fed meeting due, which could influence the strength of the USD. This could potentially impact the oil prices in the near term.

Furthermore, later this week, the EIA’s weekly inventory report is also due to come out. This could also be a potential catalyst for oil prices in the short term. Overall, oil remains flat within the said levels. Further direction can be only established on a breakout from the 57.50 or the 54.00 levels.

EURUSD bottoming out near support

EURUSD 3107

The EURUSD currency pair is seen forming a bottom near the support area of 1.1129 – 1.1110 levels. The long term head and shoulders pattern is still evolving. A rebound off the support level could signal a move to the upside. The resistance area of 1.1224 – 1.1200 could hold the gains.

A reversal near the resistance level could possibly keep EURUSD trading within the said levels. But a retest to the support area of 1.1129 – 1.1110 could trigger the head and shoulders pattern.

A breakdown from the support level will possibly push the EURUSD lower which could test parity at the very minimum. However, for the short term, we expect the EURUSD to test the 1.1200 level.

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