No change in price direction; maintain short positions. The COMEX Gold closed USD4.30 lower at USD1,294.20. This was after it ranged between USD1,291 and USD1,301.70. The price actions in the latest two sessions indicate a minor consolidation is developing after the relative sharp declines between 26 Mar and 28 Mar. Once this minor consolidation is over, we expect the commodity to test the immediate support of USD1,281.50 – this is to complete our minimum expectation that the commodity is in the process of developing a multi-week consolidation to correct the previous multi-month upward move (that started from the low of USD1,162.70 on 16 Aug 2018 and ended at USD1,349.80 on 20 Feb). Maintain our negative trading bias.

As the multi-week correction is still not showing signs of completion, we continue to recommend that traders stay in short positions. These positions were initiated at the USD1,322.70 level, which was the closing mark of 1 Mar. For risk-management purposes, a stop-loss can be placed above the USD1,349.80 threshold.

The immediate support is set at USD1,281.50, which was the low of 24 Jan 2018. This is to be followed by USD1,270.30, or the high of 20 Dec 2018. On the other hand, the immediate resistance is set at USD1,349.80, ie the high of 20 Feb. This is followed by USD1,370.50, which was the high of 25 Jan 2018.

Source: RHB Securities Research - 2 Apr 2019