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CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. CFDs are complex financial instruments and come with a high risk of losing money rapidly due to leverage. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

Technical analysis: key levels for gold and crude

A hard day for gold yesterday has seen key support breached, while WTI looks to be stabilising around the $49 mark.

Gold
Source: Bloomberg

Gold pushes lower

Tentative signs of a recovery in gold were obliterated yesterday, with the price dropping through key support at $1264. The next area to watch will be that provided by the 200-day and 50-day simple moving average (SMA) at $1255 and $1249 respectively, where some support may develop, or failing that, down to the rising post-December trendline, which would suggest support around $1241.

Bulls need to see a recovery of $1264 and then a push above $1270 to reverse the sequence of lower highs and lower lows on the hourly chart.

gold price chart

WTI has begun to find support

After a steady drop over the past month, WTI has begun to find support around the $49 mark. So far we have not seen a fresh lower low, this would require a move below the $48.32 level from last week.

Buyers now need to get the price back above $49.86 to create further momentum. Momentum indicators on the daily chart are stretched to the downside, suggesting a higher possibility of a snap-back rally in the short term.

oil price chart

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.

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