Technical analysis: key levels for gold and crude

A hard day for gold yesterday has seen key support breached, while WTI looks to be stabilising around the $49 mark.

Source: Bloomberg

Gold pushes lower

Tentative signs of a recovery in gold were obliterated yesterday, with the price dropping through key support at $1264. The next area to watch will be that provided by the 200-day and 50-day simple moving average (SMA) at $1255 and $1249 respectively, where some support may develop, or failing that, down to the rising post-December trendline, which would suggest support around $1241.

Bulls need to see a recovery of $1264 and then a push above $1270 to reverse the sequence of lower highs and lower lows on the hourly chart.

WTI has begun to find support

After a steady drop over the past month, WTI has begun to find support around the $49 mark. So far we have not seen a fresh lower low, this would require a move below the $48.32 level from last week.

Buyers now need to get the price back above $49.86 to create further momentum. Momentum indicators on the daily chart are stretched to the downside, suggesting a higher possibility of a snap-back rally in the short term.

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