Technical analysis: key levels for gold and crude

Gold looks likely to turn lower, after rallying into Fibonacci resistance. Meanwhile, Brent sells off after completing a head and shoulders formation.

Gold turning lower from 76.4% retracement

Gold managed to rally into the 76.4% retracement yesterday, yet upon hitting that deep Fibonacci level, we are now seeing the price turn lower.

Following the move below the wider 76.4% level ($1334), there was always a threat that we could be seeing a retracement before we turn lower, rather than a full recovery. As such, a break through $1351 would be required to negate the possibility of a bearish downturn from here. 

Brent follows through on head and shoulders formation

Brent has managed to break below the head and shoulders neckline yesterday, with the price now starting to regain a little ground.

However, this bounce looks unlikely to last, with the Fibonacci retracement coming into play. With that in mind, watch out for the 76.4% retracement at 7800, which coincides with the head and shoulders formation neckline. As such, while we could see short-term gains, this seems likely to turn lower once more as long as the price does not break above 6838.

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