Maintain long positions while moving up the trailing-stop. The COMEX Gold experienced a sharp intraday price reversal after testing the USD1,600.00 round figure with a USD1,619.60 high. However, this positive momentum failed to hold, with prices retracing and settling USD14.00 weaker at USD1,566.50 – breaching the previous USD1,566.20 immediate support, albeit marginally. A “Bearish Engulfing” formation also appeared. This performance came after the commodity experienced a relatively sharp upward move over the recent weeks and saw its RSI hitting an overbought reading. As a result, the risk for a price exhaustion could be confirmed should there be further negative price actions in the coming sessions. We stay positive for now. Pending confirmation of a price exhaustion signal, we continue to recommend traders stay in long positions. We initiated these at USD1,529.30, or the closing level of 31 Dec 2019. For risk-management purposes, a stop-loss can now be placed below the USD1,536.70 threshold. The immediate support is now eyed at USD1,536.70, or the low of 3 Jan. This is followed by the USD1,500.00 level. Moving up, the immediate resistance is now set at USD1,619.60, or the latest high, followed by the USD1,650.00 mark.

Source: RHB Securities Research - 9 Jan 2020