Technical analysis: key levels for gold and crude

Gold and Brent are beginning to look like we could see a move back towards the downside, in accordance with the wider outlook. 

Oil figure
Source: Bloomberg

Gold looks to be turning back onto bearish path

Gold has been turning lower following the rally into Fibonacci resistance last week, with the bearish medium-term outlook coming into play.

With that in mind, any rally from here looks like a potential selling opportunity as long as the price does not break above $1270. Watch out for the Fibonacci levels as potential areas for shorts.

Potential top for Brent forming

Brent is trading within a symmetrical triangle formation, with lower highs accompanying the higher lows. This is not necessarily a bearish reversal pattern, yet the longer term outlook for Brent points towards a potential move lower in the near future.

With that in mind, shorts are preferred unless we break above $53.00. That being said, for greater confidence, watch out for an hourly close below $51.45 to provide a bearish signal.

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This information has been prepared by IG, a trading name of IG Markets Limited and IG Markets South Africa 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. International accounts are offered by IG Markets Limited in the UK (FCA Number 195355), a juristic representative of IG Markets South Africa Limited (FSP No 41393). South African residents are required to obtain the necessary tax clearance certificates in line with their foreign investment allowance and may not use credit or debit cards to fund their international account.