Levels to watch: gold, silver and crude

Gold has clung to $1200, boosted by the recent outbreak of pessimism around the global economy, while oil prices have staged a modest comeback following yesterday’s move lower.

Gold bars
Source: Bloomberg

Gold outlook still bearish

The yellow metal is enjoying a good run of gains, although it is exhibiting some indecisiveness around $1200. A first target for this bounce is still $1210, and beyond that $1240, while the bottom of the descending channel at $1180 still acts as potential first support. Ultimately the long-term picture remains bearish, with the latest bounce still likely to bring out the sellers in due course.

Silver supported by $16

Silver is showing its usual unwillingness to probe the July downtrend, and thus the target for the time being is $16.30. A close above here targets $16.50 and then $16.80.

Support is likely around $16 and then $15.60. As with gold, this still looks like a bounce from oversold levels that will be sold in due course.

Brent testing 100-hour MA

An early test of $78 today saw buyers come in once more, and we are now watching the price test the 100-hour MA. A break through here would target $80, the peak from yesterday, and then the 200-hour at $80.80, while a drop back would head towards $78 and then the 14 November low around $77.

WTI below $75

A morning rally in US light has taken the price close to the descending 50- and 100-hour MAs, just below $75. As with Brent, the broader trend is still down but a rising intraday RSI means the price may test the Tuesday peak above $76, while $74 and then $73.40 are support on the downside.

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