No adverse price signals spotted, maintain long positions. The precious metal failed to show any clear direction in the latest trading. It ended marginally higher USD0.70 to settle at USD1.290.20, with the low and high recorded at USD1,284 and USD1,292.10. Broadly, looking at the price pattern that has been in development since the emergence of the “Bearish Engulfing” formation on 4 Jan, the commodity is seen developing a sideway consolidation. The lower bound of this sideway pattern (USD1,284.60) was tested in the prior session and is still holding. Provided the said lower bound is not breached, the risk for the COMEX Gold experiencing a deeper retracement is relatively low. As a result, we keep our positive trading bias.

With no indications to suggest the rebound – which started from the low of USD1,162.70 on 16 Aug 2018 – has reached an end, we continue to recommend traders keep to long positions. We initiated this at the USD1,216 mark, which was 14 Nov 2018’s closing level. For risk-management purposes, a stop-loss can be placed below the USD1,284.60 threshold.

The immediate support is pegged at USD1,284.60, or the low of 4 Jan. The second support is at USD1,267.40, which was the low of 21 Dec 2018. Conversely, the immediate resistance is expected at USD1,332.40, ie the high of 11 May 2018. This is followed by USD1,370.50, or the high of 25 Jan 2018.

Source: RHB Securities Research - 24 Jan 2019