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WTI crude oil prices closed lower on Thursday. The declines came despite concerns about the quality of oil coming out of Russia. Poland, Germany and the Czech Republic announced that they would stop purchasing crude oil from Russia, leading to a shut down in one of the pipelines. This is estimated to affect about 1% of global supply.

Crude Oil Could Turn Flat

The WTI crude oil extended the declines, trading close to the support level of 64.55. A retest of this level will mark a test of support. This could keep oil prices supported to the upside. The overall trend is likely to turn flat from this point in case of an upside bounce.

IMF Managing Director Christine Lagarde called for greater balance in the next phase of China's Belt and Road Initiative. She borrowed from a Chinese proverb "It is easy to start a venture — the more difficult challenge is what comes next."

Lagarde warned that "history has taught us that, if not managed carefully, infrastructure investments can lead to a problematic increase in debt". And, "to be fully successful, the Belt and Road should only go where it is needed. I would add today that it should only go where it is sustainable, in all aspects."

Also she emphasized, BRI 2.0 can also benefit from "increased transparency, open procurement with competitive bidding, and better risk assessment in project selection."

Full remarks here.

The precious metal was seen rising for two consecutive sessions. The rebound in price coincides with the test of the 200-day moving average. The gains come despite the US economic data showing a rebound in activity. However, the broader central bank outlook remains dovish leading to the upside in gold prices.

Can Gold Maintain the Upside Correction?

Although price has rebounded, the upside correction is yet to see the test of the 1285 handle. This price level remains key as resistance is quite likely to be established in the area between 1285 – 1290. A reversal off this level, of course, could signal the end of the correction as gold prices could begin to extend lower.

The common currency slipped to fresh lows on Thursday. The declines came amid a rebound in the US dollar boosted by strong economic data. In contrast, the eurozone economy is still struggling, adding to the downside. The common currency has been falling for the third consecutive session.

Can the EURUSD Fall Further?

The currency pair is trading close to a multi-year support line near the 1.1120 region. The intraday charts signal a potential rebound in price. However, the currency needs to break past 1.1140 in order to confirm the upside. The next main target to the upside comes in at 1.1226 where resistance could be established.

Pivot (invalidation): 65.40

Our preference Short positions below 65.40 with targets at 64.25 & 63.95 in extension.

Alternative scenario Above 65.40 look for further upside with 65.80 & 66.15 as targets.

Comment The RSI has broken down its 30 level.

Pivot (invalidation): 14.8900

Our preference Long positions above 14.8900 with targets at 15.0600 & 15.1100 in extension.

Alternative scenario Below 14.8900 look for further downside with 14.8400 & 14.7700 as targets.

Comment The RSI is bullish and calls for further advance.

Pivot (invalidation): 1276.00

Our preference Long positions above 1276.00 with targets at 1285.00 & 1287.00 in extension.

Alternative scenario Below 1276.00 look for further downside with 1273.00 & 1270.00 as targets.

Comment The RSI is bullish and calls for further upside.

Pivot (invalidation): 2933.00

Our preference Short positions below 2933.00 with targets at 2917.00 & 2913.00 in extension.

Alternative scenario Above 2933.00 look for further upside with 2936.75 & 2942.00 as targets.

Comment The RSI advocates for further decline.

Pivot (invalidation): 12310.00

Our preference Short positions below 12310.00 with targets at 12190.00 & 12140.00 in extension.

Alternative scenario Above 12310.00 look for further upside with 12350.00 & 12400.00 as targets.

Comment The RSI is bearish and calls for further decline.

Pivot (invalidation): 5.9220

Our preference Long positions above 5.9220 with targets at 5.9600 & 5.9800 in extension.

Alternative scenario Below 5.9220 look for further downside with 5.9000 & 5.8600 as targets.

Comment Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.