Risk-on sentiment boosts markets higher
|EUR/USD Holds Steady Above 1.1800
The euro currency managed to recover from the declines on Monday. Price action made a quick recovery after testing the lower support near 1.1800.
However, the upside gains are stalling near the trend line. This could keep price action contained for the moment.
Only a strong breakout above the trend line will see further gains coming.
But the resistance level of 1.1900 is also weighing on the common currency.
As a result, we could expect the EURUSD to hold on to its sideways range for the moment between 1.1900 and 1.1800.
GBP/USD Tests The 1.3300 Support Level
The British pound sterling is failing to make further gains after clearing the 1.3300 level.
Price action continues to pullback as the GBPUSD is firmly testing the 1.3300 level for support.
As long as the support holds, the GBPUSD is biased to move to the upside.
The next key target will be the September 1st highs of 1.3483. For this to happen, GBPUSD will need to post higher highs.
The downside, if the cable loses the 1.3300 support, we could expect to see a brief decline.
But the trend line should act as dynamic support to keep prices from falling further.
WTI Crude Oil Rises To A Nine-Month High
Oil prices are bullish as investors digest the third successful Coronavirus vaccine trials.
In hopes of travel opening up again soon and the re-opening of economies, oil prices caught a bid. Price action is up over 5% intraday on Tuesday.
The gains are now shy of the next key level near 45.00. We expect some profit- taking near this level that could send oil prices back lower.
However, the 42.00 level is now firmly established as support.
This could mean that the overall bias is starting to look to the upside for oil.
Gold Prices Continue To Descend
The precious metal is seeing another down day in the markets. The risk-on sentiment in the market is pushing the safe-haven asset lower.
Gold prices lost close to $33 on Monday and the declines continue on Tuesday as well. Price action broke past the lower support level at 1817.80.
But the declines could stall as the precious metal approaches the psychological support of 1800.00.
Any near term bounce could either stall near the 1817.79 or higher near the 1850 levels.
In any case, the upside bias for gold is diminishing as we expect to see a correction to the broader uptrend taking place.
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