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Technical analysis: key levels for gold and crude

Both gold and Brent are moving higher, yet this is likely to be a short-term phenomenon given recent downtrends.

Oil barrels
Source: Bloomberg

Golds grind higher likely to be short-lived

Gold has been gaining ground overnight following another strong move lower yesterday. This bounce is likely to be another retracement within this recent downtrend.

As such, watch the Fibonacci resistance levels at potential reversal and selling points. We would need a break through $1257 to negate this current bearish sentiment.

Brent downtrend remains in play

Brent saw another sharp move lower last night, in a continuation of the downtrend of recent weeks. With the price failing to break below $46.91, we are now seeing a short-term descending triangle in play.

As such, watch out for the break of $46.91 for a bearish continuation signal. However, a break back above $47.91 would provide a warning sign that this trend could be coming to an end, or at least slowing.

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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.