Technical analysis: key levels for gold and crude

Both gold and crude are trading within triangle formations, as consolidation reigns following a very volatile period.

Gold bars
Source: Bloomberg

Gold is trading within a symmetrical triangle pattern, as we move into the fourth day of consolidation. The bottom of this triangle comes at the 76.4% retracement, which means that at $1322 we could have a 3-to-1 risk to reward ratio for a move back into $1375 vs a move below $1305.

Ultimately, the breakout from this triangle will provide us with directional bias. A closed hourly candle above $1335 would provide a bullish view, with $1347, $1351 and $1375 the key resistance levels in view.

Conversely, an hourly close below $1322 would point towards another leg lower, with $1305 the next notable support level.

Brent continues to form triangles within triangles, where current price action is now creating a symmetrical triangle pattern. With that in mind, we are looking for a break and close through the first swing high or low to define directional bias.

Thus an hourly close below $46.84 would provide a bearish view, with $46.16 the next key support level. Alternately, an hourly close above $48.33 would point towards a rally back towards $48.80 and $49.74 resistance levels.

US crude
WTI is breaking through trendline support to continue the downtrend we have seen over the past two months. Once more, it is the 76.4% retracement which has provided resistance for the next leg lower.

However, while we are seeing selling come to the fore so far this morning, we would need an hourly close below $45.51 to bring expectations of further losses, with $45.10 and $45.00 the next key support levels. Alternatively, an hourly close above $46.93 would provide a more bullish outlook.

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