Technical analysis: key levels for gold and crude

Gold shows signs of a potential reversal, while crude continues to weaken. Will we see a period of weakness across commodities?

Worker walking among oil barrels
Source: Bloomberg

Gold pulls back to key $1200 mark

Gold has tumbled back into the crucial $1200 mark yesterday, following a period of strength throughout 2017 so far. A break below that level could spark a period of weakness should it occur, with $1188 the next crucially important support level.

On one hand, with price holding up around the $1200 mark, there is a good chance we could see a push higher once more to continue the recent bullish trend. On the other, we have seen a trendline break, with questions clearly being asked of this rally. A convincing break below $1200 could be the sign that we are set for a period of weakness.

Brent likely to weaken once more

Brent crude has managed to push higher overnight, following on from yesterday’s sharp move lower.

Considering the downtrend in place over the past three weeks, further downside seems likely, with a move back into $53.83 providing us with a completion of the 76.4% sell-off. As such, a bearish outlook remains in place unless we see a break back above $57.61.

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