Technical analysis: key levels for gold and crude

Gold maintains its upward move, but oil looks at risk of a swift move lower. 

Gold rings
Source: Bloomberg

Gold getting ready for the big job

The move higher goes on for gold, with Friday’s dip affording the chance for more buyers to hop on. The first weekly pivot point to watch for resistance is $1243.

Above this the price has a big job ahead of it – breaking the high from late February at $1260, along with the 200-day simple moving average ($1260) and also smashing through the downtrend from last year’s highs. That still gives us some short-term upside to play with. If it fails to move on above $1260 then we would look to $1195, the March low, then to the January low at $1180, and then all the way back to $1122. Above $1260 the next move higher would run into resistance at $1279 and then back to the November high at $1300.

WTI looking risky

It looks increasingly like the dip buyers have run out of ammunition as last week’s rally back to $50 brought out the sellers, and a further push higher on Friday faltered at $49.50.

The next move lower for WTI would target $47.50, the low of last week, and then down to $45, and the low from late November. As institutions continue to cut back their positioning, we could be seeing an alignment of the price action and flows that could provoke a bigger sell-off here. 

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 IG 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.

Find articles by writer