Gold price and Brent crude oil price expected to turn lower before long
Gold and Brent crude gain ground this morning, yet further downside looks likely.
Gold consolidating within recent downturn
Gold has been declining from the 76.4% Fibonacci retracement level over recent trading days, building on a period of consolidation. That comes off the back of a wider phase of strength which drove the precious metal into a six-year high.
There is a good chance that the bullish wider picture comes back into play before long. However, with the price trending lower over the short term, further downside remains a distinct possibility. A break below the $1493 level would signal a continuation of the current intraday downtrend, while a break through the $1503 level would point towards a short-term recovery of recent losses.
Brent crude on the rise after horizontal break
Brent has been gradually gaining ground since Thursday’s low. With the price managing to break through the $59.23 resistance level, we look to be retracing the wider decline from $61.32.
Watch out for Fibonacci resistance at $59.85 and $60.41. With the price trading within a rising wedge formation, a bearish breakdown is expected before long, where a break below the prior swing low provides us with the sell signal (currently $58.44). Alternatively, we would need to see a break through $61.32 to bring about a bullish wider outlook.
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