Maintain long positions as the bulls remain in control. The COMEX Gold ceased the latest session on a soft note – it shed USD7.90 to close at USD1,575.80. Trading took place in the range of USD1,570.40 and USD1,588.50. The weak performance can be seen as just a sign that the bulls are taking a breather after the recent run-up. Towards the downside, should there be a downside breach of the USD1,552.10 immediate support, the risk for the commodity to experience a deeper correction could emerge. Until this happens, we stay with our positive trading bias.

As the bulls are still showing a good control over the price trend, 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 still pegged at USD1,552.10, or the low of 21 Jan. This is followed by USD1,542.80, which was the low of 14 Jan. Towards the upside, the immediate resistance is 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 - 29 Jan 2020