Technical analysis: key levels for gold and crude

Gold is aiming to hold a vital area of support, while oil’s bounce on Friday raises the prospect of more gains. 

Gold mirrors late October pattern

Gold has tested, but held above, the 200-day simple moving average (SMA) at $1272.90 for the past four sessions. This mirrors the pattern seen during the last few days of October.

Dips towards $1270.00 continue to be bought, so long positions with stops around here could provide a way of playing a bullish view. Below $1270.00, the price will head towards $1264.00, which has provided strong support since the beginning of October.  

WTI in pullback from downtrend

WTI broke through the short-term downtrend identified on Friday, and the pullback currently in progress could provide an opportunity for new long positions.

The price failed to create new higher highs, faltering at $58.88, but a push higher is likely to test the $59.02 high from two weeks ago. The support zone last week was $57.00, so sellers will need to clear this to open the way to $55.67. 

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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