Technical analysis: key levels for gold, silver and crude

Oil prices may finally be seeing some buyers, which at least helps to offset a fairly somnolent session so far in gold and silver.

Silver bars
Source: Bloomberg

Gold bugs enduring dull period

It can’t be said to be a particularly exciting time in gold at present, as the metal continues to wallow around the $1310 level, with the $1312 region still acting as a hurdle to upward progress.

Only a close above $1312 would really put gold back on the front foot, and in the meantime we continue to wait for signs that such a move may begin to occur.

The hourly chart still shows a rising 200-hour moving average that may well act as support should gold drop back in the direction of $1300. The $1305 level is a zone where support has been found over the past week, with intraday price action highlighting $1310 as a possible upper-counterpart of the range $1305-$1310.

Silver could still drop further

The steady drop for silver since the mid-July highs has paused for the time being, but as I have pointed out before the downtrend line from $21.50 is still in place.

As a result, $19.75 is still the big support in the short-term, with an intermediate line developing around $19.80. Although a safe distance from oversold levels, the daily relative strength index is not making much effort to rise from current levels, while the ongoing price action below the 200-DMA is still keeping broad sentiment on the bearish side.

As the daily chart goes, so does the hourly. The 200-hour continues to act as major upside resistance, as does the $20.10 line that defeated bounces on 8 and 12 August.

Brent could return to breach $104

The drop through $104 for Brent is a fairly major development in this market, but further support could still be found around $103.40. The daily RSI is flagging up positive divergence, as the price records new lows even as the RSI figure rises. Thus, there is the possibility that we will see a move back through $104, even if progress towards $105 may be difficult.

On the hourly chart both the price and the intraday RSI have begun to move upwards, with the price making an attempt to breach the 20-hour MA. However, we will need a move back through the 50-hour to really indicate that this move has legs, with $104.50 being a possible hurdle too.

WTI finds support at $97

For WTI we can see incremental rises in both the price and the daily RSI, which is an encouraging sign, but a close above $98 and then $98.40 is still needed to restore optimism.

On the hourly chart we can see that $97 is holding up well as support, and with the intraday RSI pressing above 50 yet again there may be another attempt to break the 200-hour MA. If this was achieved then upside targets would be the aforementioned $98 and $98.50, while $97 and $96.70 are targets if the price falters again.

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