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Technical analysis: key levels for gold and crude

Gold’s stellar rally has come to a juddering halt, while oil prices remain on a march lower. 

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Oil rig
Source: Bloomberg

Gold

Gold’s sharp drop back below $1300 suggests that the rally of June has ended, and with both stochastics and relative strength index turning lower on the daily chart, the sellers may now have the upper hand.

A move below $1280 would then head towards $1255 and then $1236, the 50- and 100-day simple moving averages respectively. A bounce back above $1300 would restore some bullish momentum. 

WTI

The price remains stuck in a downtrend, without the sharp reversals seen in some markets. As a result, this may be just more of a bounce to be sold, and certainly any move below $47 would indicate that there is more downside to come.

At present the jury is still out on whether a bottom is in place, but if the price gets back above $49 we may have the foundations of a rally for WTI.

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