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.
Gold could target $1200
A weakening of the dollar has allowed gold to clamber off yesterday’s lows, and with momentum indicators on the four-hour chart we may continue to see a short-term bounce that will carry us back in the direction of $1200.
Although the price did not reach the $1180 level it did still bounce from the bottom end of its trading range of the past two months, with a first target of $1200 and then on to the 200-day simple moving average at $1213.
Silver could test $16
A similar picture prevails in silver, where a test of the zone around $16.60 has brought out the buyers once again. Having found support around the 50-day SMA ($16.63), the price may now be able to push on higher, even if momentum indicators do remain bearish.
A clearance of the 200-day SMA at $16.90 would be a good first step to changing the direction of the trend, but a failure to maintain the move higher would see the price move further down and test $16.20 and then $16 itself.
Brent eyes 100-day SMA
The $62 mark has stemmed the selling here for Brent, with the result that we may aim to push back towards the $64.80 area, having bounced off the 50-day SMA at $61.88. A failure to continue the rally would result in another test of the $62 support zone, before moving on to the 100-day SMA at $58.80.
WTI could drop to $52.18
Having fallen through $58, WTI now looks minded to keep on going lower, assuming it can break below yesterday’s lows of $57.50. A rising 50-day SMA at $55.52 is still first-line support, with a break through here heading towards the 100-day SMA at $52.18.