Technical Analysis 20/1/2017
By Antonis Vasloos
The EUR/USD lost ground on Thursday and is showing signs of topping, as the market struggles to extend gains beyond the 1.07 region. The EUR/USD declined 0.6% to 1.0628 on Thursday. It has since rebounded back toward 1.07, but has been unable to breach that level.
On Thursday, the euro received no support from the European Central Bank (ECB), which upheld the status quo at its first policy meeting of the year. The outlook remains tilted to the downside.
- Support (daily): 1.0609, 1.0553, 1.0519
- Resistance (daily): 1.0699, 1.0733, 1.0799
Thursday trading in the GBP/USD was once again marked by volatility, as the pair exchanged another 100 pips to close at 1.2361. The pair fell 128 pips in the previous session, just one day after recording its strongest gain in years.
At last check, the GBP/USD was trading at 1.2359, putting it on track for a weekly gain of roughly 1.6%. Technical analysis has proven largely obsolete this week, as investors tracked an event-driven calendar headlined by Theresa May, Donald Trump and a spate of economic reports.
- Support (daily): 1.2281, 1.2219, 1.2188
- Resistance (daily): 1.2374, 1.2405, 1.2467
Gold futures pivoted lower on Thursday, as the US dollar rebounded against a basket of other major currencies. However, bullion’s losses were contained, with the February futures contract slipping 0.6% to $1,205.00 a troy ounce on the Comex division of the New York Mercantile Exchange. February gold futures were last seen trading at $1,207.00 a troy ounce.
Bullion is well on its way to its fourth consecutive weekly advance. Its short-term outlook is on the bullish side, with Relative Strength holding above 60 and the MACD maintaining its upward acceleration.
- Support (daily): $1,196.46, $1,192.03, $1,188.26
- Resistance (daily): $1,204.66, $1,208.43, $1,212.86
Oil staged a narrow recovery on Thursday, pressured by an unexpected rise in US crude inventories and growing expectations for a sharp rise in US shale output. US West Texas Intermediate (WTI) for February delivery rose 32 cents, or 0.6%, to settle at $51.40 a barrel on Thursday. It was last seen trading at $51.50 a barrel.
WTI is poised for another sharp drop this week, as supply concerns continue to weigh on the market. Prices have moved sharply below the 20-day simple moving average, as investors look for new trading catalysts.
- Support (daily): $50.97, $50.57, $50.12
- Resistance (daily): $51.82, $52.27, $52.67