Technical analysis: key levels for gold and crude

Gold and crude continue their deterioration. However, on both occasions, the medium-term uptrend is expected to come back into the fore soon enough.

Source: Bloomberg

Yesterday saw gold take another leg lower, as the wider retracement continues at pace after the trendline rejection earlier in the month.

The break below $1322 means we are now looking at a good possibility that this retracement will be break below $1305, which would point towards a deeper retracement of the June 23 low.

As such, while this market is clearly trending lower, it could be worth awaiting a potential break and closed hourly candle below $1305 to signal another round of selling towards $1280. Any rally will be looking towards £1322 and $1338 as key resistance levels.

Gold daily chart

Brent has rallied into the top end of a symmetrical triangle overnight, following a fake out yesterday. Symmetrical triangles tend to work well with the stochastic oscillator and this indicator points towards the possibility of another leg lower from here.

As such, another move lower seems likely from here, with a bullish view coming in the event of an hourly close above $48.33.

Brent daily chart

WTI also sold off sharply yesterday, with price moving into trendline and horizontal support around $44.51. This falling wedge pattern points towards a potential bullish breakout as a resolution to this formation.

However, for that to happen, we would need to see an hourly close above $46.93, which would subsequently look towards $47.50 and $48.64 as the next key resistance levels.

However, until then we expect this pattern to continue, with another leg lower likely in the short-term. Support levels of note are $45.00 and $44.51.

WTI daily chart

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