Still in a correction phase; maintain short positions. The COMEX Gold advanced USD12 to settle at USD1,511.50. Trading took place in between USD1,503.40 and USD1,519.70. Despite the encouraging closing above the USD1,500 round figure, the commodity’s price actions in the recent sessions are not showing signs that its correction phase – which started from the high of USD1,566.20 on 4 Sep – has reached to an end. Towards the downside, we are still expecting the immediate support of USD1,483 to be tested. Maintain our negative trading bias. On the expectation that the correction phase is still incomplete, we recommend traders stay in short positions. These were initiated at USD1,511.10, which was the closing level of 9 Sep. For risk-management purposes, a stop loss can be placed above USD1,566.20. Immediate support is expected to emerge at USD1,483, or the low of 13 Aug. This is followed by the USD1,406 mark, which was near the low of 1 Aug. On the other hand, the immediate resistance is set at USD1,566.20, which was the high of 4 Sep. This is followed by the USD1,600 threshold.

Source: RHB Securities Research - 17 Sept 2019