Technical analysis: key levels for gold and crude

Gold has run into a key resistance level, while oil is seeing increased volatility as the OPEC meeting gets closer. 

Oil pump
Source: Bloomberg

Gold hits resistance  

Gold rallied yesterday, taking the price back to resistance at $1264. So far this level continues to hold, so we are likely to see a retracement back to the current rising trendline, or even slightly lower.

A break above $1264 would likely trigger a wave of further buying, clearing the way to $1280 and higher. It needs a move back below $1245 to reverse the bullish outlook.

Brent sensitive to OPEC meeting news

As the clock ticks down to the OPEC meeting we can expect more news to cross the wires, and some has already appeared this morning, suggesting that it may be difficult to secure an agreement to extend production cuts.

However, until Brent reverses back below $52 it may be prudent to remain on the long side. Today’s dip to $53.60 may turn out to be a buying opportunity, particularly if the price can move back above the 100-day simple moving average (SMA) at $54.03. 

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication.

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