Technical analysis: key levels for gold and crude

Gold and WTI have both managed to break out of a consolidation phase, with the wider bearish trend coming back into play.

Oil
Source: Bloomberg

Gold confirms bearish continuation

Gold managed to break out of its recent consolidation phase yesterday, with the price falling into a 16-month low. The break below $1205 is also important as that level represents the major low from July 2017.

However, most crucially, we have also moved away from the idea that we were gearing up for a period of upside following the break below the crucial $1236 double top neckline. With that in mind, the downside looks likely to continue, with any upside looking like an opportunity to sell gold. This bearish view holds unless we break above $1236 resistance.

WTI rallies into Fibonacci resistance

WTI finally managed to break lower from its recent gradual ascent, with the drop below $68.02 bringing about a renewed bearish short-term view.

This means that the rally seen yesterday is likely to be a retracement before we turn lower once more. The respect at the 61.8% level highlights the potential for that bearish move to come into play today. As such, further downslide looks likely from here unless we see a break through $70.00 resistance.

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