Maintain short positions until signs of correction reaching an end emerge. The Comex Gold settled the latest session on a positive note. It added USD9.60 to close at USD1,470.20, this came after it tagged a low and high of USD1,463.80 and USD1,474.80. The precious metal’s price actions over the latest two session are showing signs of a minor rebound, this came after it experienced a relatively sharp retracement recently. This implies we are still not seeing a strong technical indication to signal that the multi-month consolidation phase, which started from early September, has reached an end. Maintain our negative trading bias.

Until the bulls are able to signal an end to the said correction phase, we recommended traders to stay in short positions. We initiated these at USD1,464.10, the closing level of 11 Nov For risk-management purposes, a stop loss can be placed above USD1,525.00.

We are keeping the immediate support target at the USD1,406.00 mark, ie near the low of 1 Aug. This is followed by USD1,390.90, the low of 1 Jul. Moving up, the immediate resistance is now pegged at USD1,525.00, the high of 3 Oct. This is followed by USD1,566.20, which was the high of 4 Sep.

Source: RHB Securities Research - 14 Nov 2019