Technical analysis: key levels for gold and crude

Gold is under pressure once more, while oil continues to exhibit bearish tendencies. 

Oil plant
Source: Bloomberg

Gold potential support at $1246 and $1239

Gold’s move back below the downtrend line raises the prospect that we are about to see a fresh leg lower, with the creation of a new lower high putting the post-December 2016 trendline under strain. As potential support levels, we have $1246 followed by $1239.

A bounce from $1260 would suggest a return to the highs of the week near $1275, with the current pullback in the four-hour chart providing an interesting entry point for further longs.

WTI – more losses on the way?

WTI's move back below the 200-day simple moving average (SMA) was a bearish development, and despite yesterday’s recovery it does look as if more losses are on the way.

A drop below $49.40 would mark a fresh bearish move, and it would need a recovery back above $50.52 to reverse the bearish view created by the sharp drop in Tuesday’s session. 

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