Technical analysis: key levels for gold and crude

Gold falls into a crucial long term support level, while Brent manages to break above a key resistance level as it looks to continue its medium-term uptrend. 

Oil pump
Source: Bloomberg

Gold retraces from Fibonacci and trendline confluence

Gold has been gradually gaining ground overnight, following on from another drop yesterday. On a wider perspective, a long-term trendline and Fibonacci (76.4%) provide a possible area for gold to bounce from, at $1241.

As such, while the short-term picture is certainly bearish, a break below $1241 would provide greater confidence of impending downside. On the flipside, a break above $1251 would provide a signal that we could be in for some form of bounce for gold.

Brent breaks above key resistance level

Brent managed to rally up through the crucial $64.57 resistance level yesterday, bringing a bullish outlook into play.

The indecision candles seen this morning point towards some form of pullback. However, given that break through $64.57, any such short-term weakness would be viewed as a temporary in nature.

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.