Technical analysis: key levels for gold and crude

Commodities come under pressure, with gold and crude selling off towards key support levels.

Smelted gold
Source: Bloomberg

Will gold rally from deep retracement?

Gold has been selling off following an intraday topping pattern which broke lower yesterday. The projection of that target brings the price down to $1260, which coincidentally is the key support level which would have to break for a bearish view to come into play.

Until that happens, there is a good chance of a bounce to continue this recent resurgence. Should that occur, watch out for $1267 and $1274 as the near-term key resistance levels. 

Brent sell-off reaches crucial support level

Brent sold off sharply yesterday, with price tumbling before it could reach the key $53.95 resistance level. Interestingly, we have seen price pull all the way back to the key swing low of $51.71. That level would need to be broken to provide a more bearish outlook for Brent. Until then, we could see a bounce from here into the $53.00 region.

WTI deep pullback could spark another rally

A similar story prevails for WTI, except we did see a break to a new high above $52.00, while the pullback has not yet reached the key $50.12 swing low. As such, a bullish outlook remains as long as price is above the $50.12 mark. 

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