Technical analysis: key levels for gold and crude

Oil has held on to its gains, while gold seems primed for further falls.

Gold bullion
Source: Bloomberg

Gold’s turn lower may indicate period of selling

The sharp turn lower yesterday might suggest we are seeing the beginning of a new leg lower. A modest move higher over the course of the session yesterday took the price back towards $1285, but with the hourly stochastic no longer oversold, fresh selling momentum may develop.

A move below yesterday’s lows around $1278 would then suggest a drop towards $1265. 

WTI looks to build upon new support

Yesterday’s rally has put a floor in for now, so if the price holds above $44 this gives us a clear level to watch for support.

The next target would be the 200-day simple moving average (SMA) at $45.98, while above this the price must get back above the 2016 trendline, above $46.50. A move below $44 could see the price head back to $40, not seen since late July.

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.

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.