Maintain short positions as the correction phase is still not invalidated yet. The COMEX Gold formed a white candle to end USD39.20 stronger at USD1,735.70 – following two sessions of weakness. The high was posted at USD1,743.10. However, as long as the precious metal remains below the USD1,745 immediate resistance, we still believe the correction phase that started from the high of USD1,788.80 on 14 Apr is still incomplete. Towards the downside, a downside breach of the important resistance-turned-support of USD1,700 could mean further weakness for the commodity. For now, we are keeping our negative trading bias.

On the bias that that this correction phase may still be extending, we advise traders to stay in short positions. These were initiated at USD1,701, or the closing level of 30 Apr. For risk-management purposes, a stop-loss can be placed above the USD1,745 threshold.

The immediate support is revised to USD1,720 – the price point of the latest session, followed by the USD1,700 round figure. Moving up, the immediate resistance is still pegged at USD1,745, which is near the high of 30 Apr. This is followed by USD1,765, ie near the high of 23 Apr.

Source: RHB Securities Research - 8 May 2020