Maintain long positions, as there were no clear price signals for a deeper correction. The COMEX Gold ended the latest session on a positive note, adding USD5.80 to close at USD1,566.40. The session saw a high and low of USD1,553 and USD1,570.30. Price over the past two sessions indicate signs of stabilisation, which means there is still no confirmation for 8 Jan’s “Bearish Engulfing” formation. By extension, the risk for the precious metal to experience a deeper correction phase remains contained for now. Premised on this, we keep to our positive trading bias.

As the bulls are still able to retain control, 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 USD1,547.40, ie the low of 9 Jan.

The immediate support is 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 set at USD1,619.60, which was the high of 8 Jan’s “Bearish Engulfing” pattern. This is followed by the USD1,650.00 mark.

Source: RHB Securities Research - 13 Jan 2020