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Technical analysis: key levels for gold and crude

Gold begins to ask questions following a rally into trendline resistance. Meanwhile, crude prices begin to turn lower, following the creation of a short term head and shoulders formation.

Oil pump
Source: Bloomberg

Gold finding support following pullback

Gold has found its initial gap higher sold into, with the price moving back into the crucial $1282 support level overnight. Given that this comes off the back of a rally into a key trendline resistance, it’s not surprising that questions are being asked.

However, for the next move to become clear, we need either a break higher from here, or a move back below $1282. 

WTI begins to break lower

WTI broke through the trendline support last week, and it appears that we will see that initial move extended, given the current push below $53.01. That completes a head and shoulders formation, pointing towards further downside. In the short term at least.

We would need a break through $53.72 to negate this bearish outlook.

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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.