Technical analysis: key levels for gold and crude

A rally in oil prices has finally materialised, while the revival of risk appetite has left gold looking friendless.

Gold bars
Source: Bloomberg

Gold looks like it may struggle
Having spent the past three days stuck between $1100 and then $1095, the price is now heading towards the bottom end of the range. Thursday’s lows around $1094/$1095 may provide some support, otherwise we are looking at a move back towards $1085 and then $1080. With risk appetite back in action gold may struggle, but a move above $1105 would target the January highs at $1110.

Brent finally bounces
The bounce in oil that many have been waiting for is underway, with the price of Brent back above $30. Upside targets now come into view around $31.35 and then $32.97, while if the bulls really get going the key support in December around $36 will come into play as resistance.

Given the fundamental outlook, this bounce is not likely to be anything more than a retracement in the trend, but sellers will want to wait until the price gets back below $30 to signal that the bounce has run its course.

WTI rally continues
The rally has entered a second day, with the price targeting $31.36 and then $32.73. A sharply rising hourly trendline suggests support might be found around $30.50, but even if this does not hold the $29.50 area could still see buyers return.

A move back below $29 would be the cue for more downside, with the lows of the week around $27.50 in prospect. 

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