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.
Established in 1974
Over 185,000 clients worldwide
15,000 markets worldwide

Technical analysis: key levels for gold and crude

The gold pullback continues, yet will a major trendline come to its rescue? Meanwhile, crude remains in an uptrend, with another leg higher likely.

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.
Worker checking oil barrels
Source: Bloomberg

Gold pulls back to trendline support
The weakness seen in gold over recent days was unexpected given the look of a bullish triangle breakout in play. However, the sell-off has taken us back to trendline support which is currently around $1240.

Yesterday saw price action fall down towards this level and rally heavily. Thus another move lower would be looking at $1240 as an important level of support.

Alternately, an hourly close candle above $1259 would signal a more bullish outlook, with resistance levels at $1263, $1273 and $1280 in view. 

US crude rolling over once more?
US crude managed to tentatively break back above the Tuesday high of $39.46 yesterday, following a very deep retracement to $37.23. Crucially, the uptrend remains intact owing to the higher low and high.

We are seeing some hesitancy to break through the $39.46 level and thus another leg higher would be expected in the event of an hourly close above that resistance level.

To the downside, an hourly close below $38.65 would be required for evidence of a deeper retracement, with $37.86 the next key support level.

Brent fails to make new highs
Interestingly, Brent crude has failed to retake the highs of $41.65 and thus a closed hourly candle above that level would bring about a bullish view. It makes sense to await a bullish signal from both Brent and US crude should they start to break higher.

However, to the downside, an hourly close below $40.69 would bring expectations of a deeper retracement, with $40.37 the next support level.

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.