No confirmation to suggest positive trend is weakening; maintain long positions. The precious metal failed to sustain its earlier session’s positive tone as it slid from a high of USD1,304.30 to a low of USD1,293.20, before closing at USD1,294, indicating a decline of USD4.50. The commodity’s price movement since the appearance of the “Bearish Engulfing” formation on 4 Jan is still showing the characteristic of a narrow sideways consolidation. Towards the downside, the risk for a greater retracement to develop could be triggered, should the immediate support of USD1,284.60 be breached. Until this takes place, we stay with our positive trading bias.

As the commodity’s overall positive trend is still not showing signs of ending, we still recommend traders to keep long positions – we initiated this at the USD1,216 mark, which was 14 Nov 2018’s closing level. For riskmanagement purposes, a stop-loss can be placed below the USD1,284.60 threshold.

Towards the downside, immediate support is expected at USD1,284.60, ie the latest session’s low. The following support is at USD1,267.40, or the low of 21 Dec 2018. On the other hand, the immediate resistance is pegged at USD1,332.40, which was the high of 11 May 2018. This is followed by USD1,370.50, or the high of 25 Jan 2018.

Source: RHB Securities Research - 11 Jan 2019