Maintain long positions pending completion of the consolidation phase. The precious metal recorded a gain of USD1.70 to settle at USD1,419.60. Trading took place within the range of USD1,414.60 and USD1,433.50. Despite the gains, we are of the view that the metal is still in the process of developing its consolidation phase. This consolidation phase is meant to correct the previous multi-week sharp upward move, which reached an overbought reading recently. Until there are signs to suggest that the consolidation phase is taking the shape of a deeper retracement, we keep to our positive trading bias.

Given that the consolidation phase is still shallow in nature, we retain our recommendation for traders to stay in long positions. We opened these positions at USD1,333.60, which was the closing level of 5 Jun. For risk management purposes, a stop-loss can be placed at the breakeven mark.

The immediate support is expected at the USD1,400 level, a round figure. This is followed by USD1,336.60, which was the low of 17 Jun. On the other hand, the immediate resistance is set at USD1,432.90, or the high of 28 Aug 2013 – this is followed by the USD1,500 threshold.

Source: RHB Securities Research - 1 Jul 2019