Technical analysis: key levels for gold and crude
Gold is in consolidation mode, as it turns lower once again. Meanwhile, Brent has broken higher, completing a bullish inverse head and shoulders formation.
Gold continues to consolidate
Gold has been drifting lower following a failed attempt to break through the $1317 resistance level. This points towards continued consolidation, with a break and hold below $1303 required to bring about another leg lower. Should that occur, look towards the 61.8% support level ($1296) as the next point of reference.
However, until we break the $1303 level, there is a good chance we will rebound once more to continue this recent period of consolidation.
Brent breakout points towards further gains
Brent has managed to break through the crucial $63.75 resistance level overnight, bringing about a new two-month high.
Looking at it from a wider perspective, we can also see an inverse head and shoulders formation that has been completed with this breakthrough $63.75. Further upside looks highly likely from here, with pullbacks providing us with better buying opportunities. A break below $60.46 would be required to negate this bullish outlook.
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