Gold price breaks into multi-year high, as Brent price regains lost ground
Gold surges through historical resistance zone, bringing wider bullish outlook. Meanwhile, crude prices are showing signs of life after a rare decline in inventories.
Gold surges through crucial resistance zone
Gold has managed to burst through the $1347-$1375 resistance zone following yesterday’s Federal Reserve (Fed) meeting.
The prospect of a new round of easing from the Fed was enough to bring about a new five-year high for gold, bringing a bullish breakout that was three years in the making. This moves us into an area with precious little resistance, where further upside looks very likely. As such, a bullish view remains in play unless we break below $1333.
Brent crude starts to regain ground after fall in stocks
Yesterday’s decline in the US inventories figure was a rare undershoot of estimates, with the recent build-up in US stockpiles providing a narrative of overproduction and oversupply in the US. That decline provided us with a rebound to push the Brent price through the $62.22 resistance.
The next hurdle is at $63.53, where a break below that level would signal a likely wider bullish phase coming into play. Such a move could simply be a retracement of the sell-off from $69.34. Yet with this current base being created at the 61.8% Fibonacci retracement, bulls are likely to feel a cautious sense of optimism after recent developments.
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