Bears are charging towards the downtrend line; maintain short positions. The COMEX Gold performed weakly in the latest trading. The precious metal generally trended lower throughout the session, with the high and low posted at USD1,218 and USD1,206.60, before closing at USD1,209.4, implying a decline of USD5.20. The soft session can be seen as the extension of the price rejection from the USD1,246 immediate resistance mark – which the bulls attempted to crack over the recent weeks. Based on the current technical landscape, chances are high that the commodity may test the uptrend line (as drawn in the chart) in the coming sessions. Hence, we maintain our negative trading bias.

As chances are high that the commodity may retrace towards the said uptrend line, we continue to recommend traders to keep to short positions, which were initiated at USD1,214.60, the closing level of 9 Nov. For risk management purposes, a stop-loss can be placed at USD1,230.30.

Towards the downside, immediate support is set at USD1,184, which was the low of 24 Aug. The second support is expected at USD1,162.70, the low of 16 Aug. Moving up, the immediate resistance is set at USD1,246, the high of 26 Oct. This is followed by USD1,272.30, or the high of 9 Jul.

Source: RHB Securities Research - 13 Nov 2018