Technical analysis: key levels for gold, silver and crude

Gold and silver have seen a modest bounce today, while oil markets remain broadly unchanged. 

Oil pump
Source: Bloomberg

Gold struggling to make solid gains

A small rise in gold has done little to change the view that the metal is struggling to make any meaningful gains. So long as it remains below $1320 then the upside seems quite limited.

For now the 100-day moving average is doing its best to act as support, while on an hourly chart at least the trend is up, buyers having returned around $1292.

Although pushing towards the 200-hour MA at present, it will be $1320 that makes or breaks this move upwards.

A move lower would need to break last week’s lows around $1294 to become a sustained move, but this would take us back to the 200-DMA, providing a possible entry point ahead of the usually stronger August period for gold.

Silver revisits $21

Once again we say hello to $21 for silver, the level that was so magnetic in the last week of June and first week of July. However, the metal is now overbought on an hourly chart and this may act to slow any further gains to the upside.

If silver does continue to move higher then the first goal is $21.50, the peak from last week, and then beyond that to $22.

On the downside, $20.70 and then the 200-DMA at $20.30 should provide support.

Brent could head towards 200-DMA

We can see on a weekly chart that the $105 area acts to halt selling in Brent, and this has been evident once again, with the drop last week below $106 being only temporary.

Now Brent appears to be forming a base around $107 that may allow it to move back in the direction of the 200-DMA.

But if a move higher is to be sustained it must break the 200-hour MA, something that it tried and failed to do last week.

We saw the buyers come back in just below $106, so this remains the most important support for the time being.

NYMEX targets 50-DMA

The rally here on Thursday ran out of steam just shy of $103, and then Friday’s price action witnessed stabilisation around $101.50. Crude needs to hold above $102 to suggest that the bounce from the 200-DMA is still in progress.

On the upside the 50-DMA around $104 is the next target, and a close above here would really indicate that the latest dip in crude has been bought, while the key $100 level should continue to act as it did last week and contain the selling on the downside.

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