Initiate long positions as the uptrend may be resuming. The COMEX Gold formed a white candle to register a gain of USD25.20 at USD1,752.10 – crossing above the previous resistance point of USD1,745. The said upside breach has in our view likely signalled the commodity has completed its one-month correction phase which started from the high of USD1,788.80 on 14 Apr and completed with multiple retesting of the USD1,700 mark. The RSI is also indicating momentum is picking up again. With this, chances are high that the commodity is ready to resume its uptrend. Switch our trading bias to positive.

Our previous short positions, initiated at USD1,701, or the closing level of 30 Apr, were closed out at USD1,745 in the latest session. On the bias that the uptrend is resuming, we initiate long positions at the latest close. For risk management purposes, a stop-loss can be placed below USD1,705 mark.

We revised the immediate support to USD1,725 – the price point of 13 May. This is followed by USD1,705, the low of 11 May. Conversely, the immediate resistance is now pegged at USD1,767 – near the high of 23 Apr. This is followed by USD1,788.80 – the high of 14 Apr.

Source: RHB Securities Research - 15 May 2020