Technical analysis: key levels for gold and crude

Gold hesitates despite wider bullish overview, while Crude prices continue to rise towards major resistance levels.

Source: Bloomberg

Gold drifting lower towards trendline support
Early gains from yesterday have eroded heavily for gold, with the market moving towards a crucial ascending trendline. This trendline has propped up the price over the past week and thus there is a good chance we could see any selling capped at this level.

Alongside this, we also have the $1271 support level, which could coincide to provide another bounce. Following the triangle breakout in late April, a bullish outlook came back into play once more and thus we look at this market with the view that the bullish medium-term picture will return eventually.

With that in mind, this current downside seems unlikely to last, with a break towards $1287 likely in the coming days. However, a closed hourly candle below $1263 would negate this bullish view.

Gold daily chart

WTI charges towards massive resistance level
It has been a very consistent start to the week for WTI, with yesterday’s gains continuing into today’s session. It is clear that with such a steady trend, most people will be buying on any short-term pullback.

However, looking at the weekly chart below, it is clear that the $51.24 level is absolutely crucial to price action over the coming days. Should we see a break through this level, then it could mean the worst is over for the market. However, an inability to match or regain that level would be a warning sign that the trend of lower highs and lows remain in play.

As such, any bullish positions should be taken with a knowledge that this $51.24 level is going to be crucial to the market mindset.

WTI daily chart

Brent continues to gain ground amid strong week
The price continues to move higher in a very convincing manner, following on from a substantial rally last week. While this provides a clear trend for people to jump onto, it is worthwhile waiting for a retracement for a better risk/reward ratio.

Any pullback to $48.32 in particular would be an interesting point for bulls to get long once more. The current bullish view would be negated with a break below $47.00.

Brent daily chart

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