Technical analysis: key levels for gold and crude

Gold finally breaks below key support level, while Brent continues its uptrend with a rally into fresh multi-year highs.

Oil rig
Source: Bloomberg

Gold breakdown points towards further downside

Gold managed to break from a multi-month range this week, with the price consolidating overnight. This is likely to be a precursor to further downside, with a bearish short-term view in place unless we see a rally through yesterday’s high of $1297.

There is a distinct possibility that this period of weakness is a wide retracement, and thus a break below the 61.8% ($1286) level would point towards a break towards the 76.4% retracement at $1267.

Brent rallies into fresh highs once more

Brent has once again managed to break higher, keeping the uptrend intact.

This new three-year high maintains the bullish outlook, but also raises the likeliness of another pullback towards the bottom of the Bollinger band before we push higher once again. A break below the $77.60 mark would negate this current uptrend. 

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