Top three charts of the week: OIL.WIT, DE30, EURUSD

OIL.WTI

Let’s start today’s analysis with the oil market. Crude price remains stuck near post-pandemic highs. Despite breaking below the local trend line, the sellers did not manage to take control over the market. Looking at the chart from the technical point of view, the $40.50 area is the key resistance for now. As long as the price sits below, the downward correction is possible. In such a scenario, a $37.30 handle will be the first target for market bears. This level is marked with the previous price reactions and the 61.8% Fibonacci retracement. Traders should keep in mind that OPEC+ is discussing whether to extend output cuts at current levels or to reduce them. Decision on the matter could be a trigger for a major move on the oil market. 

OIL.WTI H4 interval. Source: xStation5

DE30

The German index is testing the key resistance area once again. DE30 launched today’s session with a bullish gap and we can see a continuation of an upward trend. However, looking at the daily time frame, one can see that DE30 is trading near the key resistance area which is marked with the highs from 8th June. If buyers manage to break above it, new upward impulse could be launched and it may bring the index towards all time highs (13,800 pts). EU leaders are set to discuss the EU recovery fund this weekend. Failure to reach agreement could weigh on European stocks next week as it will prolong period of uncertainty.

DE30 D1 interval. Source: xStation5

EURUSD

The major currency launched today’s session with an upward move. EURUSD is trading above the key resistance (1.1420). The price broke above the highs from 10th June and the way higher seems to be left open. As long as the EURUSD is trading above the aforementioned 1.1420 handle, continuation of the upward move towards YTD highs (1.1490) looks the base case scenario. This level is additionally strengthened by the 127.2% exterior Fibonacci retracement. Nevertheless if the buyers manage to break above it, the next resistance to watch can be found at 1.1580, where the 161.8% retracement is located. The ECB is set to announce the latest monetary policy decision this Thursday (12:45 pm BST). While no change to the level of rates is expected, aggressive bond buying and the EU recovery fund may be in focus during Lagarde's press conference (1:30 pm BST).

EURUSD D1 interval. Source: xStation5