Technical analysis: key levels for gold and crude

Gold takes a breather within a strong rally which has been taking place throughout 2016. Conversely, crude price continue to tumble, with the rally seen this morning expected to be sold into.

Silver
Source: Bloomberg

Will gold's rally continue?

Gold bulls have been having a better time of it lately, with a clear uptrend coming into play throughout January so far.

We are seeing a moderate pullback this week, yet further upside seems likely. The $1098 levels seems key this morning, with an intraday double-bottom being created should we see a close above that level.

As such, a closed hourly candle above $1098 would provide a bullish picture for the day, with trendline resistance (currently $1103), $1108 and $1111 in view.

However, a close below $1092 would provide a more bearish picture with $1089, $1085 and $1081 the next in view.

US crude selloff continues to roll on

US crude has seen substantial devaluation so for this year, with price losing almost $7 since the first trading day of the year.

We have seen no signs of this trend slowing down and thus unless price closes above $32.21, the bearish view remains, with $31.72 an interesting resistance level before that.

Below $31.24, support levels are hard to come by, yet watch out for whole numbers.

Brent downside expected

Brent is also well into a downtrend, with the current intraday rally likely to be sold into once more.

Key levels of resistance to note here are $31.51 and $31.84, where an hourly close above $31.84 would bring likeliness of a stronger retracement higher.

However, unless that happens, another turn lower seems to be on the cards, with $30.74 the first notable support level.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. 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. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Find articles by analysts

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.