Technical analysis: key levels for gold and crude

Gold remains steady, while oil prices continue to hold their rising trendlines.

Oil barrels
Source: Bloomberg

Gold set to climb
The small dip overnight has already been bought, with the gold price moving back towards $1270. The definitive bounce off $1250 on Friday confirms this as the first major level to watch on the downside, with an initial upside target of $1280.

While intraday indicators are either overbought or close to it, it might be better to wait for another test of the 200-hour simple moving average (SMA) – currently at $1244. As long as this indicator continues to point higher, then the likely course is still upwards for gold.

Gold chart

Brent favours a buy the dip policy
The Brent price finds itself at the 100-day SMA for the first time since July. Although bullish positions in crude are still rising gradually, the rally still seems to have further to go, so moves back towards $36, with stochastic indicators going oversold, are the elements to watch for.

This trend should not be argued with, and thus dip buying remains the order of the day. It would need a move below $35 to disturb this outlook.

Brent chart

WTI awaits a pullback
The rising trendline saw another bounce on Friday, sending the WTI price back above $36 for the first time since early January. We would be looking for pullbacks this week to create more attractive long position entries, with support coming in around $35. The upside target remains $38. 

WTI chart

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