Technical analysis: key levels for gold and crude

Gold and Brent exhibit periods of consolidation and retracement. However, the wider story is the same, with a bullish outlook expected to return before long.

Gold
Source: Bloomberg

Gold continues to retrace lower

Gold has continued its decline, following a breakdown from the ascending channel seen throughout the past week. The key here is that this pullback is perceived as a retracement rather than a reversal, as long as we do not break below the $1260 mark.

As such, the Fibonacci support levels will play an important role as potential reversal areas. With the price having broken below the 50% level, watch out for the 61.8% ($1278) and 76.4% ($1271) pullbacks. A bullish view is thus in play unless we move below $1260.

Brent ascent making slow progress

Brent has been moving higher once more over the past week, with the price heading back towards the crucial $58.93 resistance level. The gap open on Monday has now been closed, with the price subsequently moving back into trendline resistance.

While a bullish outlook is held, a break above $58.33 would add greater confidence that this current consolidation is over. 

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