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Technical analysis: key levels for gold and crude

Recent downside for gold and Brent could be short-term, with latest gains in place. However, Brent looks a more reliable trend compared with gold for now.

Oil
Source: Bloomberg

Gold pulls back after sharp gains

Following a sharp appreciation, gold has drifted lower overnight, with the price rallying towards the $1297 region.

However, the stochastic indicator has been breaking back below 80 in a bearish manner, which raises a warning sign. As such, it makes sense to await a break above $1297 region to provide a signal that the recent bullish trend remains in place. 

Brent pulls back into trendline and SMA support

Brent has been retracing lower this morning, bringing the price back into trendline and 50-hour simple moving average (SMA) support.

With a clear uptrend in place over the short term, there is a good chance we could see another move higher from here. With that in mind, as long as the price does not break below $62.39, another move higher looks likely from here. 

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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.