Technical analysis: key levels for gold, silver and crude

Markets are adjusting to news of a possible ceasefire in Ukraine, although the European Central Bank meeting tomorrow still weighs on the asset class.

A gold bar
Source: Bloomberg

Safe havens will be out of favour if the ceasefire in Ukraine is genuine, and will be hit further if the ECB stays its hand tomorrow. Meanwhile, oil should find support on increased risk appetite, which gives some hope for a modest recovery after recent heavy losses.

More downside likely for Gold

We saw gold dive towards $1260 this morning, before recovering, an indication that the zone around $1265 may provide some support. However, although the daily relative strength index has managed to rise, the loss of the $1275 area suggests more downside is in store, and on this basis another drop towards the $1260 area is likely.

A close back above $1275 would signal another attempt to breach the 200-day moving average around $1285.

Silver could drop to $19 level

Silver remains under pressure, and a drop through yesterday’s low around $19.08 would mean that $19 itself comes into focus.

An oversold reading on the daily RSI means some form of bounce is possible, but the downtrend from $21.50 still means that progress above $19.20 should be limited.

Brent could return to 20-DMA

The weekly chart demonstrates how the $100 level in Brent is major support, with the commodity rising this morning and seeing an upturn in the daily RSI tool.

However, the area around $101.40 should be resistance, with a close above here taking us back towards the 20-DMA around $102.90.

$94 level holding back WTI gains

US crude held above yesterday’s lows, but $94 is once again holding back further gains. Even then, the short-term downtrend remains intact, with a close above the 200-hour moving average around $94.19 being needed if the commodity is to reach the highs above $95.50 seen earlier this week.

IGA, may distribute information/research produced by its respective foreign marketing partners within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

This information/research prepared by IGA or IGA Group is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. In addition to the disclaimer above, the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

See important Research Disclaimer.