Technical analysis: key levels for gold and crude

Gold continues its ascent, yet the wider downtrend is expected to kick in once more. Meanwhile, crude prices move into trendline support, set within rising wedge.

Oil barrels
Source: Bloomberg

Gold continues to move higher, yet sellers not far

Gold has enjoyed a particularly consistent uptrend over the past week, with the price moving towards the $1259 resistance level. While we have a very clear uptrend in place over the past two weeks, this is set within what looks like a bearish reversal for gold on the longer-term perspective.

With that in mind, while further gains could be in the cards, it makes sense to look for a potential bearish reversal play from the $1261-$1274 zone (61.8%-76.4%). As such, while we would need a break back below $1235 to negate the current uptrend, a bearish outlook will come back into play should we continue our ascent into those levels.

Gold chart

Brent moving into trendline support

Brent is selling off once more this morning, in a continuation of the weakness we saw at the back end of last week. The break through $49.92 last week provided us with a rising wedge pattern, which points towards a potential bearish break down the line.

However, for now, we are seeing a move into trendline support, which is worth watching for a potential rebound. Ultimately, we would need a break back below $46.20 to resume the bearish medium-term mindset. Until then, short-term losses are expected to see a move into trendline support, upon which the validity of this wedge comes into play. Make sure to keep an eye out for news coming from the meeting between OPEC and non-OPEC members.

Brent chart

Denna information har sammanställts av IG, ett handelsnamn för IG Markets Limited. Utöver friskrivningen nedan innehåller materialet på denna sida inte ett fastställande av våra handelspriser, eller ett erbjudande om en transaktion i ett finansiellt instrument. IG accepterar inget ansvar för eventuella åtgärder som görs eller inte görs baserat på detta material eller för de följder detta kan få. Inga garantier ges för riktigheten eller fullständigheten av denna information. Någon person som agerar på informationen gör det således på egen risk. Materialet tar inte hänsyn till specifika placeringsmål, ekonomiska situationer och behov av någon specifik person som får ta del av detta. Det har inte upprättats i enlighet med rättsliga krav som ställs för att främja oberoende investeringsanalyser utan skall betraktas som marknadsföringsmaterial.