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WTI price drops into key support, while gold price turns higher

WTI slumps into critical support, with the potential for further losses if broken. Meanwhile, gold attempts to regain ground after recent losses.

Gold on the rise after deep retracement

Gold declines seen last week took us into the zone between the 61.8% and 76.4% Fibonacci retracement levels. The price appears to have turned higher once again after finding support on the previous resistance level of $1674.

With the price having eased back a little overnight, a rally up through $1703 would go a long way to building a more bullish intraday pattern that could set us up for another push towards $1748. One warning sign came with the bearish divergence that has been seen over recent days, yet a break through $1703 would at least provide us with a more bullish price action move to focus on.

WTI declines may not be over yet

WTI saw an incredible decline to kick off the week, with news headlines dominated by the drop into negative territory of the final day of the May contract. Nevertheless, things are somewhat more normal on the spot market, with the prices closing in on the $20.00 handle.

Crucially, WTI is now trading back at the $20.52 support level which has largely provided support for the past month. With that in mind, the ability or inability to break below $20.52 will be key in determining the outlook for the day ahead. Given the sharp declines seen over the past week, a drop below this level could give way to another significant bout of downside.

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