Two trades to watch: EUR/USD, WTI

EUR/USD picks up as US yields ease, but still looks vulnerable. WTI bounces off 50 sma, uptrend in tact for now.

Charts (2)

EUR/USD picks up as US yields ease, but still looks vulnerable

US 10 year yields rose to 13 month high of 1.75% yesterday. However, they have eased today to around 1.70%. The US Dollar is also giving back some of Thursday’s gains.

Some European countries plan to resume using the AstraZeneca covid vaccine which is underpinning the common currency. Although France tightening lockdown restrictions adds weight to the Euro

Where next for EUR/USD?

EUR/USD slid back from its overnight high of near 1.20 to 1.1900. The pair attempted to form a double top pattern which began earlier in the week. However, a break below 1.19 needed for this bearish pattern to be confirmed.

The pair has picked up slightly and trades at 1.1926 currently -it is testing its 20 & 50 sma on the four hour chart. Failure to break above this resistance could see the pair look to test 1.19 again and move towards 1.1840 low March 8.

Should the recovery manage a break above the 20 & 50 sma then resistance at 1.1990 could be tested for a third time this week. A break out above this level at 1.1990 could see the EUR/USD breakout towards 1.2050.

Learn more about trading forex


WTI bounces of 50 sma, uptrend still intact for now

WTI dropped by 7.6% yesterday in its worst day since the wild swings back in April. Across the week WTI is looking to shed some 8%

Energy prices faltered this week amid concerns regarding the vaccine rollout in Europe & tighter lockdown restrictions impacting the demand outlook. The stronger US Dollar added pressure to oil.

Today, the US Dollar is easing, tracing yields lower and some European countries have said they will resume the AsatraZeneca vaccine providing a touch of optimism.

The economic calendar is relatively quiet with just the Baker Hughes rig count in focus later today.

Where next for WTI?

Whilst WTI dropped sharply through its ascending trend line dating back to early November. The 50 sma on the daily chart offered support, halting the sell off. Breaking through these two supports could lead to a deeper selloff bringing 57.00 support into focus.

However, the price has pushed higher from the 50 sma and has retaken the key $60.00 sma. To look convinsing the recovery would need to push beyond 62.80 back over the ascending trend line. Beyond here buyers could re-aim for the yearly high of 67.80

Learn more about trading oil


More from EUR

Disclaimer: The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex and commodity futures, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to Forex.com or GAIN Capital refer to GAIN Capital Holdings Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.