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Technical analysis: key levels for gold and crude

Weakness for gold comes amid a widespread risk-on sentiment. Meanwhile, Brent manages to push into a fresh two-year high.

Gold
Source: Bloomberg

Gold continues recent downtrend

Gold managed to fall further, thanks to the risk-on mode set by yesterday’s European Central Bank (ECB) meeting. We have now seen the price break below the 76.4% retracement, with the price subsequently contending with an ascending trendline dating back to July 2016.

A break below that trendline would then look towards $1260 as the next major level in question. For now, there is a chance we could see a short-term rebound. However, unless we break through $1282, another leg lower remains the likeliest eventuality.

Gold chart

Brent punches into two-year high

Brent has managed to break through both the $58.48 and $58.93 resistance levels overnight, with the price hitting the highest level in over two years. Interestingly, we are now seeing the price retest the $58.93 level as new found support.

While there is a good chance we could see the price move below that level, the key here is whether we see a move back below $57.70. Until then, there is a good chance we could see this market push onwards from here.

Brent chart

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