Maintain long positions. The COMEX Gold ended the latest session on a weak tone and at the closing, came near to testing the 100-day SMA line. It formed a black candle to settle at USD1,227.60, indicating a decline of USD8.20. The low and high were at USD1,226.10 and USD1,237.60. The weak session came after the commodity tested the immediate resistance of USD1,239 multiple times recently. Should there be a strong breakdown from the said SMA line in the coming sessions, it will likely confirm a price rejection from both the immediate resistance and the SMA line. Thus, the probability would be higher that a deeper retracement could be developing. Until this happens, we are keeping our positive trading bias.

Until there are clear signs that a deeper retracement may be developing, we continue to advise traders to keep to 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, we revise a stop-loss below USD1,219.30, or the low of 12 Oct.

Towards the downside, immediate support is set at the USD1,215 mark, or 20 Jul’s low. The following support is at USD1,184, which was the low of 24 Aug. Moving up, the immediate resistance is eyed at the USD1,239 level, which was 26 Jul’s high. This is followed by USD1,272.30, or the high of 9 Jul.

Source: RHB Securities Research - 30 Oct 2018