Gold drops below $1200 again
Gold has given up the ghost again, having tried its best to stay north of $1200. The resistance level still holds but it just didn’t have the legs; $1200 has proved to be a stumbling block for the metal recently and it just couldn’t resist slipping below the level.
The yellow metal is currently resting on the 50-hour MA of $1195, and support is likely to kick in at $1190. A move below that would put the 200-hour MA of $1181 in traders’ crosshairs. If gold musters up the courage to make another attempt on $1200, it could make a convincing break through the $1203 (50-DMA) mark if it stands any chance of breaking the downward trend. The recent high of $1206 would be the next target to the upside.
Gold’s biggest problem is that it keeps finding trouble around the 50-DMA. It hasn’t traded above its 50-DMA for nearly a month, and a failure to close above here opens the way to another test of $1180 and even the month lows below $1150.
Silver slides overnight
Silver was struck by profit-taking overnight and the metal has slipped into negative territory after trying its best to resist it. The metal has been making steady gains since the lows of early November but there is a sense that traders are now cautious after a strong run. The 50-hour MA of $16.31 is providing immediate support; a move below that would put $16.20 in sights, and below that traders will look to the 200-hour MA of $16.04. The initial target to the upside is $16.50 and then the recent high of $16.62 would be the next level to watch.
Brent supported by $80
Brent closed above $80 last week, marking a good period for the commodity. The price is broadly unchanged on the session so far as markets await the OPEC meeting on Thursday. There have been some rumblings that Iran wants to trim production in response to the falling prices, but Saudi Arabia is likely to oppose any significant reductions in output. $80 is providing initial support, and if that level is punctured then the 200-hour MA of $79.57 will be on the radar while $79 will be the next level of support on the downside. To the upside, $81 is the immediate target, and then the recent high of $81.61 will be in focus. Beyond that, dealers will look to $82.20 as a potential target.
WTI holds above 200-hour MA
WTI has been range-bound overnight and traders will be continue to tread lightly on the run up to the OPEC meeting. However the crossover of the 50-hour MA and the 200-hour MA is a bullish signal, with the $76 is acting as immediate support. The 200-hour MA of $75.58 is the foundation of the current upward move, and if that is taken out then $74.75 will be in play. Resistance is holding at $77 for the time being, but a break through here would put us on course to the Friday high around $77.65.