Gold, WTI – Technical Review

Gold breaks below the strong barrier of 1180


Gold Trading Account?

Gold continued falling on Friday, reaching and breaking below the key area of 1180 (R1). It is worth noting that the last time we saw the precious metal trading below that level was back in July 2010. However, the decline was halted marginally above 1160 (S1), which coincides with the 61.8% retracement level of the October 2008 – September 2011 advance. In my view, the dip below 1180 (R1) strengthens the likelihood that the price could go even lower. A clear violation of the 1160 (S1) barrier could set the stage for extensions towards the low of the 19th of April 2010, at 1125 (S2). Our daily momentum studies support the notion. The 14-day RSI dipped below its 30 line and is pointing down, while the daily MACD lies below both its zero and signal lines, confirming the recent strong negative momentum. However, back on the 4-hour chart, I see that the RSI lies within its oversold territory and could move above its 30 line in the close future. Hence, I would be watchful of a possible upside corrective wave before the bears pull the trigger again.
• Support: 1160 (S1), 1125 (S2), 1100 (S3).
• Resistance: 1180 (R1), 1205 (R2), 1222 (R3).

WTI still trendless


Gold Trading Account?

WTI declined on Friday, but found support slightly above the 79.40 (S2) barrier. As long as WTI is trading between that support obstacle and the resistance line of 83.50 (R1), I would maintain my flat approach. I still prefer to see a dip below 79.40 (S2), before getting again confident on the downside. On the other hand, a move above 83.50 (R1) is needed to flip the short-term outlook positive in my view. In the bigger picture, although I still see a downtrend structure, the 14-day RSI remains above its 30 line, while the MACD, although below zero, stands above its signal line. These momentum signs give me additional reasons to remain neutral, at least for now.

• Support: 80.00 (S1), 79.40 (S2), 79.00 (S3).
• Resistance: 83.50 (R1), 85.00 (R2), 86.30 (R3).

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