Technical analysis: key levels for gold and crude

Gold continues to gain ground, while Brent remains in a bearish mindset given the completion of a head and shoulders formation.

Oil drill tubes
Source: Bloomberg

Gold continues ascent within wedge

As expected, gold managed to break higher yesterday, with a new high created in the wake of a bounce from the four-hour 50-day simple moving average (SMA).

We are clearly moving lower for now, with the ascending trendline wedge support coming into play. A wedge is a bearish pattern, yet until we break to a new low (below $1259), the uptrend remains in play. 

Brent breaks below crucial support level

Brent fell below the $51.01 mark yesterday, completing a head and shoulders formation. This provides us with a renewed bearish view, meaning that the current bounce is likely to be fleeting and merely gives us a better shorting opportunity.

As such, a bearish view remains unless we see a push through $53.00.

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