Technical analysis: key levels for gold and crude
The recent decline in gold has paused momentarily, and with Fibonacci support in play, the move from this consolidation is going to be key. Meanwhile, Brent weakness looks like a precursor to another leg higher.
Gold pauses after steep declines
Gold has sold off heavily since reaching the 76.4% Fibonacci retracement a week ago, yet we are finally seeing some consolidation taking shape. There is a good chance that this could just be a brief breather before we see another leg lower.
However, with the price consolidating around another 76.4% level, we could also see some form of rebound from here. Ultimately it makes sense to see how we emerge from this consolidation, where a break below $1274 would bring about expectations of a move back towards $1266. Otherwise, a rally through $1279 would signal some form of rebound taking shape.
Brent drifts lower, yet bullish trend may not be over yet
Brent is drifting lower after a bullish gap higher at the start of the week. The recent respect of an inside trendline points towards a potential area of support should we see further downside.
However, ultimately this current move lower looks like a precursor to another surge higher. As such, while we could see short-term downside, the likeliness is that the price of Brent will create another leg higher before long. Only with a break below $69.33 would this bullish outlook be negated.
IGA, may distribute information/research produced by its respective foreign affiliates 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.
Please see important Research Disclaimer.
Trade on commodities
Trade commodity futures, as well as 27 commodity markets with no fixed expiries.1
- Wide range of popular and niche metals, energies and softs
- Spreads from 0.3 pts on Spot Gold, 2 pts on Spot Silver and 2.8 pts on Oil
- View continuous charting, backdated for up to five years
1In the case of all DFBs, there is a fixed expiry at some point in the future.
Live prices on most popular markets