Technical analysis: key levels for gold and crude
Gold and Brent fall back after recent periods of upside. However, with wider bullish trends in play, this period of weakness could provide us with a buying opportunity.
Gold pullback could take us into trendline support
Gold is looking to follow up on the pullback seen in the second half of last week, with price moving towards the near-term swing low of $1321.
While a break below that level would provide a bearish signal, this could be a case of posting an ABC style retracement, with the ascending trendline coming into play once more. As such, while we could see further downside for the short term, we would need to see a break below $1303 to truly negate the bullish outlook for gold.
Brent finding support around trendline confluence
Brent sold off sharply from the $68.00 region yesterday, coming off the back of a period of upside which took the price into a three-month high. The break through $63.75 last week provided an inverse head and shoulders confirmation, with the price following through for much of last week.
However, with the price having pulled back, this looks like an opportunity to get long rather than something to worry about. With the confluence of two ascending trendlines in play, it makes sense to look for a resurgence from here, with a break through $65.18 providing an intraday bullish signal. Given we are moving into a more bullish phase for both the stochastic and MACD histogram, it looks like momentum is also turning in the favour of the bulls.
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