Technical analysis: key levels for gold and crude

Gold weakness comes into question, with price rising into wedge resistance. Meanwhile, crude strength has started to show signs of weakening.

Oil pipeways
Source: Bloomberg

Gold testing wedge top

Gold is testing a descending trendline this morning, as we start to see some signs that the recent downturn could come under pressure. The continued creation of lower highs and lower lows provides us with a reason to believe that the trend remains in play for now, yet a break and hourly close above $1181 would provide a signal that we are set for some short-term gains.

As such, watch out for whether this trendline breaks and whether $1181 remains intact as a gauge of whether this downtrend will continue apace.

Brent showing initial signs of weakness

Brent crude has been rolling over on an intraday basis, with a fall below the $54.30 mark providing a new low which looks like it will be followed by a lower high.

The key level which needs to be broken to provide confidence of a wider sell-off is $53.00. However for now, a period of continued short-term weakness seems likely following a sustained period of strength for Brent. We would need an hourly close above $55.08 to provide a short-term bullish outlook once more. 

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