CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.

Levels to watch: gold, silver and crude

Commodity markets have quietened down, although with the European Central Bank meeting looming this may be the calm before the storm.

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
Liquid oil barrel being filled
Source: Bloomberg

Gold's rally in question

It seems gold can move above $1200 after all. It appears that $1195 is support for now, but we need to see a close above $1205 on a daily basis to get some real momentum into this asset class. The unwillingness of the price to break through the 50-day moving average is a warning that all may not be well in gold’s attempt to rally.

A drop back below the 200-hour moving average around $1195 certainly restores the bearish outlook, and it looks like gold will face stiff competition if it tries to break through $1220.

Silver could reach $17.50

Having moved up for three days, silver is aiming to clear $16.50. Success in this endeavour would lead it on to challenge $16.70, with a close above here opening the way to $17.50.

Meanwhile on the downside, $16.10 and $15.90 are potential support levels. So long as the price holds above the July downtrend line the picture looks to be marginally more on the bullish side.

Brent sellers have upper hand

The slip back below the 50-H MA means that Brent is now once again looking to challenge the lows around $68 seen at the beginning of the week. Yesterday’s peak around $73 has proved to be too much, and a declining hourly relative strength index shows that the sellers still have the upper hand here.

WTI could target $69.50

After Monday’s bounce US light crude is declining again, for a second consecutive day. For now $67 is holding up as support but if it is broken the dive to $64 could be swift.

For now the price shows little inclination to go above $67.90, but even a break through here would only target $69.50 in the first instance. 

This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.  Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. 

CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.