Maintain long positions, as prices continue to advance beyond the USD1,600 mark. The COMEX Gold extended its gain for the fourth session. At the closing, it added USD8.20 to close at USD1,611.80. The high was posted at USD1,615.90. This implies the uptrend is still extending and this bias could be further enhanced should 8 Jan’s “Bearish Engulfing”, which has a high of USD1,619.60, be invalidated. While the RSI is again approaching an overbought reading, in the absence of a price exhaustion signal, we keep to our positive trading bias.

As the bulls are in firm control over the price trend, we maintain our long recommendation. We initiated these at USD1,586.40, ie the closing level of 13 Feb. For risk-management purposes, a stop-loss can be placed at the breakeven mark.

The immediate support is revised to the USD1,600 round figure. This is followed by USD1,590, which was derived from 18 Feb’s candle. Meanwhile, the immediate resistance is pegged at USD1,619.60, ie the high of 8 Jan’s “Bearish Engulfing” pattern. This is followed by the USD1,630 threshold.

Source: RHB Securities Research - 20 Feb 2020