Marshall Gittler
Trading Analysis
Gold
Gold collapsed yesterday, penetrating two support levels in a row (today’s resistance). The fall seems to complete a bearish flag continuation pattern which, combined with our negative short term studies, favors the bearish picture of gold. The 20-period moving average lies below the 200-period moving average while the MACD oscillator lies below its trigger line in a negative territory. However, the RSI’s reading is a cause for some concern as it seems ready to exit its oversold zone, and as a result, an upside pullback is possible. It is important to note that the precious metal is near the critical floor of 1273 (S1). A clear downward break of that important levell would be likely to trigger extensions towards new short-term lows.
Support levels are at 1273 (S1), followed by 1242 (S2) and 1208 (S3).
Resistance is identified at the 1291 (R1) level, followed by 1316 (R2) and 1343 (R3).
Oil
WTI tested for a second consecutive day the 102.23 (R1) barrier and moved lower. During the European opening the price is trading below that level and it seems that the bears are ready to extend their moves towards the 100.72 (S1) support, where a clear break should challenge the next floor at 99.18 (S2). Moreover, WTI lies below both the 20- and 200- period moving averages and alongside with the negative value of MACD, they increase the probabilities for the continuation of the downward bias.
Support levels are at 100.72 (S1), 99.18 (S2) and 98.00 (S3). The latter two are identified on the daily chart.
Resistance levels are at 102.23 (R1), followed by 103.53 (R2) and 104.40 (R3).
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