Maintain long positions as the commodity managed to close above the immediate support. The COMEX Gold tested the immediate support of USD1,547.40 with an intraday low of USD1,542.80. This was before it rebounded to settle USD6.10 weaker at USD1,550.90. The ability of the commodity to settle above the said immediate support, in our view, means 8 Jan’s “Bearish Engulfing” formation is still not confirmed. Hence, the risk for it to experience a deeper correction is still contained for now. Premised on this, we stick to our positive trading bias.

Pending confirmation for the “Bearish Engulfing” formation, 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 USD1,547.40 mark.

The immediate support is maintained at USD1,547.40, which was the low of 9 Jan. This is followed by the USD1,500.00 level. Towards the upside, the immediate resistance is eyed 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 - 15 Jan 2020