Technical analysis: key levels for gold and crude

Commodities are on the rise this week, with gold and crude performing well amid a weak dollar story. This morning is seeing a pullback, but this looks more like a retracement than a reversal. 

Oil refinery plant
Source: Bloomberg

Gold takes a breather
The commodity has enjoyed a great week, which was all sparked by the weak payrolls number on Friday. Yesterday saw another strong leg higher, which has slowed into consolidation.

As such, it makes sense to either trade a short-term pullback, await a decent pullback to a deep Fibonacci, or else await an hourly close back above yesterday’s high of $1266. 

Brent retraces within uptrend
Brent crude is also seeing early losses today, in what clearly looks like a retracement rather than a top. The market has reached a new seven-month high this week and as such, it was always likely to take a breather at some point.

It therefore makes sense to buy into dips, with a closed hourly candle below the recent swing lows of $51.96 and particularly $51.45 providing the warning sign of a potential short-term trend shift. 

US crude retracement unlikely to last
WTI is also pulling back this morning, following on from a strong rally of late. This retracement seems likely to result in another move higher and, thus, the bullish view remains in play, with the 61.8% ($51.42) and 76.4% ($51.28) Fibonacci retracements representing interesting near-term support levels. This bullish view would come into question with an hourly close below $51.05.

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