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Technical analysis: key levels for gold, silver and crude

Commodities are turning lower yet again, after a particularly messy day yesterday in crude oil, with Brent dropping 2.4% and WTI losing 1.8%. 

Gold bars
Source: Bloomberg

50-DMA supporting Gold 

Gold still remains unwilling to head much closer to $1320, with yesterday’s move higher being beaten back down during the course of the session.

However, the 50-day moving average should continue to provide support on the downside for the time being, while the relative strength index is steadily moving upwards as well.

However, until gold moves firmly above $1320 it seems difficult to imagine real upside emerging here.

At least it remains stronger on the hourly chart, remaining firmly above the 50- and 200-hour MAs. A close below $1305 would cancel out the positive scenario and raise the possibility of a further drop towards $1280.

Silver unable to move past 200-DMA

Meanwhile silver is not at all keen to break above $20, and has traded in a 15 cent range all week. Until silver can break the descending trendline from the July levels around $21.50, then the metal looks set to move back towards $19.50 and potentially beyond.

Neatly the commodity remains unable to push above the 200-hour MA, while the intraday RSI has turned down as well. The $19.80 level would seem to be the first support zone if we do see another drop today.

Brent sitting at 13-month low

Brent now sits at a 13-month low, after a horrendous day yesterday that saw the commodity drop 2.4%. If $102 is lost there is little in the way of the price heading towards the key $100 level, not seen since the end of June last year.

Only a close back above $103.40 would cancel out the negative scenario, and until the daily RSI moves into oversold territory a bounce seems an unlikely prospect.

WTI daily RSI oversold

We have now seen WTI drop below the trendline from the 2012 lows, as the gains of 2014 are steadily whittled away.

The $95.20 mark, the high point of November 2013, seems to be holding as support for now, but a drop through here would bring the $94 level into play.

The daily RSI is flashing an oversold reading but with the moving average convergence/divergence declining as well there seems little reason to think that a bounce in this commodity will be anything but a short-term event.

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