Technical analysis: key levels for gold and crude

Gold attempts to extend its gains following trendline support earlier in the week, while oil prices continue to consolidate following the selloff.

Oil
Source: Bloomberg

Gold rallies overnight

Gold has continued to rally following a bounce from a descending trendline dating back to June 2013.

We are seeing price drift lower somewhat this morning, yet the likeliness is that we will create a new higher low to then extend this bounce we are seeing.

The overall bearish view would return with a close back below $1066, yet until that happens, a move higher remains likely, with a close above $1079 the indicator of further upside.

US crude sees sideways chop

US crude prices continue to be very choppy, with little direction to trading this week.

Given the strong downtrend in play overall, further downside is probably the most likely outcome, yet it seems more sensible to await either a bullish breakout above $43.03 or bearish break with a close below $41.09.

Upside resistance levels to watch are at $42.59, $42.82, $43.03 and $43.25, with support expected at $41.25 and $41.09.

Brent consolidates

Brent continues to consolidate following a strong downtrend, with a clear lack of direction for now.

The selloff seen prior to this consolidation points to possible downside.

However, until we see a break and close above $45.23 or below $43.26, then the sideways price action is likely to persist.

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