Maintain long positions as the price momentum remains high despite being overbought. The COMEX Gold’s upward move continued to progress. At the latest closing, it breached above the previous immediate resistance of USD1,500. The session’s low and high were posted at USD1,478.40 and USD1,516.20, before closing USD34.90 stronger at USD1,513.20. We take the latest positive session as a lead that the commodity’s upward momentum is still healthy. While the Daily RSI reading of 75.5 is suggesting an overbought situation, we are keeping our positive trading bias in the absence of negative price actions that could mark a top for the rally.

Given that the price momentum is still showing strength, we retain our recommendation for traders to stay in long positions. We opened these positions at USD1,333.60, which was the closing level for 5 Jun. For risk-management purposes, a stop-loss can now be placed below the USD1,406 mark.

We are keeping the immediate support at USD1,406, or near the low of 1 Aug. This is followed by USD1,336.60, which was the low of 17 Jun. Meanwhile, the immediate resistance is now set at USD1,550 level. This is followed by USD1,600.

Source: RHB Securities Research - 8 Aug 2019