Commodities Analysis and Opinion
Gold, WTI Crude Oil Trade Sideways: Key Levels to Monitor
2024.05.30 04:04
Gold
- Gold () volatility has dropped significantly as we are in a sideways consolidation at this stage.
After last week’s bearish engulfing candle on the weekly chart, I warned that this would happen, but it takes a couple of weeks before we can try to identify the consolidation pattern.
Is it a triangle, channel, pennant, flag, etc?
In the meantime, i will do my best to guess the likely high and low for the day to try to find trade opportunities where we can risk 5 points in the hope of making 10.
Unfortunately, I cannot make the market move, so this is the best we can do in these conditions.
- There could be resistance at 2350/55 this morning and shorts need stops above 2360. Target is 2340.
- I would try a short again at 2375/80 (if we reach that far today)- stop above 2385.
Targets: 2365, 2355
- A break higher however can be taken as a short-term buy signal targeting 2407/10.
- Holding below 2335 keeps the pressure to the downside for today targeting 2328/25 (which I do NOT see as a support so i do not suggest trying a long).
A break below 2321 should be a sell signal targeting 2309/06.
Silver
- Silver () continues to outperform Gold as expected as we target 3210/20 and a retest of the high at 3250.
- A break above here is also expected eventually (and could do so even if Gold is unable to follow), although I have no idea of the timing. If seen, look for targets of 3275, 3295/99 and eventually 3345/65.
- First support at 3110/3090 and longs need stops below 3070.
- A break lower risks a slide to a buying opportunity at 3010/2990 and longs need stops below 2970.
WTI Crude JULY Future
- July break above 7930 was a buy signal targeting 8000/8010, which was hit immediately.
- WTI Crude then collapsed from last week’s high at 8060 back to support at 7900/7860 and longs here need stops below 7820.
- Just be aware that a break above 8080 could be a buy signal for today targeting 8100 and resistance at 8150/70, where a high for the day looks likely.
- Just so you can calculate the spread for the Oil contract on your platform, the futures on Tuesday had a low at 7899 and a high at 8062.
After last week’s bearish engulfing candle on the weekly chart, I warned that this would happen, but it takes a couple of weeks before we can try to identify the consolidation pattern.
Is it a triangle, channel, pennant, flag, etc?
In the meantime, i will do my best to guess the likely high and low for the day to try to find trade opportunities where we can risk 5 points in the hope of making 10.
Unfortunately, I cannot make the market move, so this is the best we can do in these conditions.
Targets: 2365, 2355
A break below 2321 should be a sell signal targeting 2309/06.
Gold broke to the downside of what was probably a bear flag at around 10 am UK time.
This should have been a sell signal but unfortunately, there was little follow-through and we only reached 2335, before trading in a 10-point sideways range ever since.
WTI Crude jumping up and down but going nowhere and currently trading mid-range, at the same prices as the beginning of May – so in effect we have gone nowhere!
The 1-month range is only about 450 ticks.
