Technical analysis: key levels for gold and crude

Commodities continue to gain across the board, with gold breaking out of a multi-month triangle formation and crude in a straight line rally.

Oil plant
Source: Bloomberg

Bullish breakout for gold

Gold is in the process of breaking out of a symmetrical triangle formation, which has been in play since early February. The key to a confirmation of this would be a closed candle (4-hour would give better confidence than 1-hour) above the triangle top of $1284.

Should that occur, we are likely to see a strong week ahead for gold. For now, we have clearly broken through $1271 resistance and subsequently found support, posting a bullish hammer candle this morning. With that in mind, further upside seems likely which looks onward towards $1280, $1284 and $1300.

A closed hourly candle below $1271 would bring a more neutral view given that we are heavily extended to the upside currently. 

US crude rallying heavily

US crude is in a very convincing and consistent uptrend this week, with resistance levels continuously being broken. As such, we are looking to continue our bullish view, with any retracements seen as buying opportunities. The most recent swing lows of $45.83 and $45.18 are key to gauging whether the rally still has legs.

As long as we continue to create higher lows and highs, further upside seems likely, with $47.00 and $48.00 the next major handle in sight.

Brent shows no signs of stopping

Brent is similarly rallying heavily, with retracements few and far between. With that in mind, the bullish outlook remains in play, with the continued creation of higher lows and highs pointing towards further gains.

Key near-term support is found at $47.21 and $46.53. Near-term resistance is expected at $48.55 and $49.01.

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