Commodities Lower – Gold and WTI Review

Gold continues its retreat



Gold continued trading lower yesterday and today during the early European morning looks ready to challenge the 1065 (S1) support line. A break below that line is likely to extend the retreat and perhaps aim for our next support of 1057 (S2). Although the metal is still trading above the downtrend line taken from the peak of the 16th of November, the fact that it failed to overcome the 1088 (R2) barrier on the 4th and 9th of December corroborates my view that the current setback may continue for a while. Our short-term oscillators support the notion as well. The RSI fell below its 50 line, while the MACD, already below tis trigger line, has just turned negative. On the daily chart, I see that the plunge below the upside support line taken from the low of the 20th of July has shifted the medium-term outlook to the downside. As a result, I believe that the metal is poised to continue its down road in the foreseeable future and I would treat the recovery started on the 3rd of December, or any possible extensions of it, as a corrective phase for now.

• Support: 1065 (S1), 1057 (S2), 1046 (S3)

• Resistance: 1076 (R1), 1088 (R2), 1100 (R3)

WTI tumbles and hits 36.35



WTI traded lower yesterday to hit support at 36.35 (S1). The short-term trend remains negative in my view and therefore, I would expect a clear move below 36.35 (S1) to initially challenge the 36.00 (S2) line. Another break below 36.00 (S2) is likely to pave the way for the psychological zone of 35.00 (S3). Taking a look at our oscillators though, I see signs that a corrective bounce could be on the cards before the next negative leg. The RSI looks ready to exit its below-30 territory, while the MACD, although negative, stands above its trigger line. On the daily chart, I see that WTI has been printing lower peaks and lower troughs sin the 9th of October. What is more, on the 7th of December, the price fell below the lower bound of a downside channel, something that reveals accelerating downside speed and increases the possibilities for further declines and a test near the psychological zone of 135.00 (S3).

• Support: 36.35 (S1), 36.00 (S2), 35.00 (S3)

• Resistance: 37.50 (R1), 38.55 (R2), 39.30 (R3)

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