Technical analysis: key levels for gold and crude

Fresh multi-year lows today in crude confirm the bears are in control, while gold has touched $1100 for the first time since early November.

Oil barrels
Source: Bloomberg

Gold continues its climb
Unsurprisingly gold continues its ascent, moving in a straight line yesterday and hitting $1100 in early trade today. The 50-hour simple moving average ($1084) provided good support early on Wednesday, so a dip today towards this level could provide another buying opportunity.

The daily relative strength index (RSI) and stochastics are beginning to look overextended, but a continued move higher heads towards $1108 and then $1120.


Brent still oversold
The break of $36 earlier in the week continues to produce one of the most dramatic moves in Brent crude in months. On the daily chart the bear case is quite clear-cut, but with intraday RSI and stochastic indicators heavily oversold it might be better to wait for a bounce back towards $33.44 or even $35. However, it looks like $30 is now just a matter of 'when', not 'if'. 

Brent crude

WTI testing 2009’s lows
The 2009 lows here are being tested this morning, with a look at the monthly chart suggesting the next big area of support will be $25. On the daily chart $30.62 looks to be the next stop. As with Brent, intraday charts are heavily oversold, but short-term bounces back towards $33.20 or above will be seen as selling opportunities. 


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