Charts of the Week: Gold and USOIL rally reverse + GER30 rebounds

Market Analysis /
09 Jan 2020

XAUUSD reversed recent gains, as risk appetite is slowly improving. The false breakout above $1600 and sharp reversal led to position covering from Gold bulls, and negative RSI divergence on the H4 chart suggests that the correction might not be over yet. Gold traders will keep a close eye on the support area between $1553 and $1555.

XAUUSD.pro H4 Chart; Source: AxiTrader
XAUUSD.pro H4 Chart; Source: AxiTrader

USOIL saw a sudden reversal as well, with pressure still increasing. Following the break below the $62 support level, traders will be looking at the area between $59.82 (38.2 % Fibo of the July 19-Jan 20 rally) and $60 level as potential area of support. The uptrend remains intact, but renewed geopolitical tensions will keep volatility at elevated levels, and traders should prepare for larger price swings.

USOIL Daily, Source: AxiTrader
USOIL Daily, Source: AxiTrader

GER30 bounced off the rising trendline from the November low, and managed to clear the important resistance level at 13,200 points. Sentiment in global equity markets has turned positive, as investors see an escalation of the Iran crisis as unlikely. The next major resistance level to watch lies at 13,457 points, and DAX bulls already see the record high at 13,596 points as next target.

GER30 Daily, Source: AxiTrader
GER30 Daily, Source: AxiTrader

AUDUSD is trading within a rising channel, but was again rejected at the upper trendline. The currency pair has also broken below the 21 and 200 DMA, while the RSI is not signaling oversold conditions yet. This may suggest that the Aussie Dollar could see further losses in the near-term. Support is seen at the lower trendline, followed by 0.6780.

AUDUSD Daily, Source: AxiTrader
AUDUSD Daily, Source: AxiTrader

The information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any trading strategy. Readers should seek their own advice. Reproduction or redistribution of this information is not permitted.

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