Maintain long positions as the bulls remain in control. The COMEX Gold ended USD5.50 higher at USD1,583.70. This was despite it giving back a significant part of its intraday gains – at one point it reached a high of USD1,594.70. Overall, we still see the commodity’s upward move as still intact – this was even after it experienced a correction subsequent to 8 Jan’s “Bearish Engulfing” formation, which saw it reaching the support level of USD1,542.80. Premised on this, we stick to our positive trading bias.

In the absence of negative price signals of a risk for a deeper correction as the result of the said “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 USD1,552.10 level.

The immediate support is maintained at USD1,552.10, or the low of 21 Jan. This is followed by USD1,542.80, which was the low of 14 Jan. Meanwhile, the immediate resistance is now set at the USD1,600 round figure. This is followed by USD1,619.60, the high of 8 Jan’s “Bearish Engulfing” formation.

Source: RHB Securities Research - 28 Jan 2020