Initiate long positions on a possibility for a rebound play. The commodity was unable to maintain its earlier session’s positive tone – at the close it eased USD1.50 to settle at USD1,290.20. The low and high were at USD1,281.20 and USD1,295.40. Based on the COMEX Gold’s price performance from the USD1,267.90 immediate support, there is a good possibility that it may be able to rebound further. This positive bias could be further enhanced should the commodity be able to breach above the downtrend line (as drawn in the chart). Based on these, the current trading bias is still positive.

Our previous short positions – initiated at USD1,291.30, or the closing level of 12 Apr – were closed out at breakeven on 30 Apr. On expectations that the commodity may rebound further, we initiated long positions at USD1,292.70, which was the closing level of 30 Apr. A stop-loss can be placed at below the USD1,267.90 level.

Towards the downside, the immediate support is revised to USD1,267.90, or the low of 23 Apr. This is followed by USD1,236.50, ie the low of 14 Dec 2018. On the other hand, the immediate resistance is expected at USD1,330.80, which was the high of 25 Mar. This is followed by USD1,349.80, or the high of 20 Feb.

Source: RHB Securities Research - 2 May 2019