Technical analysis: key levels for gold and crude

More of the same for gold and crude, with the soft metal gaining ground and the oil moving lower. The trend certainly seems to be your friend for commodities.

Gold bars
Source: Bloomberg

Gold breaks higher once more
Gold has been working out very well, with relatively consistent price action. Yesterday’s triangle saw an upward breakout, with a deep pullback crucially not breaking below the $1346 level. We are now seeing a sharp appreciation, which will likely turn into another round of consolidation soon.

As such, a bullish view remains, with consolidation and retracements seen as opportunities to scale up. We would need to see an hourly close below $1346 to negate this bullish view.

Brent sell-off still in play
Brent has also seen the trend continue at pace, with another sharp move lower yesterday. We are expecting further losses, with yesterday’s low of $42.50 turning into clear resistance this morning.

As such, further downside seems likely, with $41.92 the next important short-term support level of note. A break back above $42.50 would not necessarily negate this bearish view, but would instead point towards a deeper retracement towards $43.42. As such, we would need an hourly close above $43.89 to regain a more bullish view.

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