Maintain long positions. The COMEX formed a white candle in the latest trading session – suggesting it was under the bulls’ control. The session’s low and high were at USD1,220.40 and USD1,236.90, before it ended USD8.30 higher at USD1,230.30. The positive session can be seen as the extension of the breakout from the 50- day SMA line and also the previous immediate resistance of USD1,215 on 11 Oct. As the rebound is not showing signs of exhaustion and the daily RSI reading of 62.14 is still below the overbought threshold, we are keeping our positive trading bias.

As the latest session can be seen as the positive follow-up from the recent upward move, we continue to advise traders to keep their long positions. Recall that we initiated these positions after the precious metal breached above the USD1,207.60 mark on 12 Sep. For risk-management purposes, a stop-loss can be set at the break-even level.

We keep the immediate support target at USD1,215 mark, or 20 Jul’s low. This is followed by USD1,184, which was the low of 24 Aug. Conversely, immediate resistance is eyed at the USD1,239 level, which was 26 Jul’s high. This is followed by USD1,272.30, the high of 9 Jul.

Source: RHB Securities Research - 16 Oct 2018