Technical analysis: key levels for gold and crude

Crude tumbles out of a two-month range, following a big rise in US inventories, while gold keeps falling, albeit at a slower pace.

Gold bars
Source: Bloomberg

Gold continues to tumble

Gold drifted lower throughout yesterday and overnight, following the move below the crucial $1216-$1220 support zone.

This market has been remarkably consistent, yet with the key $1200 level coming into view, there could be some form of reaction in that area. In any case, as long as we continue to create lower highs and lower lows, a bearish outlook remains in place. 

Gold chart

Brent drops to a new 2017 low

Brent tumbled through a host of support levels yesterday, following another big build on the inventories number. Crucially, we have now seen a move below the $53.83 support level, which underpinned the past two months of the price action. As such, it looks as though a top is in place for the moment, with the further downside likely.

The lack of any near-term swing high means creating a decent trade can be difficult. An hourly close back below yesterday’s low of $53.00 would provide a sell signal, partially negating the chance of a big bounce to recover some of yesterday’s sell-off. That also has the benefit of providing a new swing high, upon which to base our stops. Until then, further gains certainly are a possibility given yesterday’s incredible moves.

Oil Brent crude 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.