Maintain long positions despite the deeper-than-expected consolidation. The COMEX Gold was under the bears’ control in the Friday’s session. At the closing it weakened USD6 to settle at USD1,241.40, after it generally moved lower throughout the session – high and low were posted at USD1,247.30 and USD1,236.50. While the consolidation phase that has been in development over the past week was deeper than expected – as it fell back below the previous resistance of USD1,246 – provided that immediate support of USD1,235.80 is holding, chances are still high for the commodity to trend higher. Hence, we keep our positive trading bias.

As the uptrend that started from the low of USD1,162.70 on 16 Aug is still firmly intact despite the deeper-thanexpected consolidation phase, we continue to recommend traders keep to long positions at the USD1,216 mark. This was 14 Nov’s closing level. For risk-management purposes, a stop-loss can be placed below the USD1,235.80 threshold.

Towards the downside, immediate support is still pegged at USD1,235.80, which was the low of 4 Dec. The second support is at USD1,202.40, or the low of 13 Nov. Moving up, the immediate resistance is set at USD1,272.30, or the high of 9 Jul. This is followed by USD1,286.80, ie the high of 19 Jun.

Source: RHB Securities Research - 17 Dec 2018