Technical analysis: key levels for gold and crude

Gold has been selling off, with Fibonacci needed to come into play or else we could see a wider bearish picture come about. Meanwhile, Brent upside could be fleeting amid a broader bearish trend.

Gold drops into Fibonacci support

Gold has dropped below trendline support and the 76.4% retracement of the rally from $1218.

Whether we should use the $1218 mark or $1216 for the Fibonacci drawing is arguable, and thus it is worthwhile noting the $1222 Fibonacci support that marks the low of the day thus far. As such, watch for whether we break below here, with a fall below the $1218 level providing a strong signal of further downside to come. Until then, watch for whether we respond to this Fibonacci support level or not.

Brent continues to grind higher

Brent has been gradually regaining ground over the past week, coming off the declines seen throughout the first three weeks of the month.

There is a strong chance of another push higher today, with Brent continuing the current short-term rebound. However, it is worthwhile noting that there is a strong chance that this is a retracement of the $80.49-$75.16 sell-off. As such, while a bullish short-term outlook remains, this would only translate into a wider bullish outlook if we break through $80.49. Until then, watch for Fibonacci resistance up ahead.

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