Technical analysis: key levels for gold and crude

Commodities come under pressure, with gold and crude selling off towards key support levels.

Smelted gold
Source: Bloomberg

Will gold rally from deep retracement?

Gold has been selling off following an intraday topping pattern which broke lower yesterday. The projection of that target brings the price down to $1260, which coincidentally is the key support level which would have to break for a bearish view to come into play.

Until that happens, there is a good chance of a bounce to continue this recent resurgence. Should that occur, watch out for $1267 and $1274 as the near-term key resistance levels. 

Brent sell-off reaches crucial support level

Brent sold off sharply yesterday, with price tumbling before it could reach the key $53.95 resistance level. Interestingly, we have seen price pull all the way back to the key swing low of $51.71. That level would need to be broken to provide a more bearish outlook for Brent. Until then, we could see a bounce from here into the $53.00 region.

WTI deep pullback could spark another rally

A similar story prevails for WTI, except we did see a break to a new high above $52.00, while the pullback has not yet reached the key $50.12 swing low. As such, a bullish outlook remains as long as price is above the $50.12 mark. 

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.