Maintain short positions as correction phase is likely incomplete. The COMEX Gold continued to extend its rebound, adding USD47.60 to close at USD1,989.90, with the high posted at USD1,992. The commodity has been staging a rather sharp counter-trend rebound over the past four sessions, following its steep retracement between 8 and 11 Aug. While the said rebound has been very strong, we believe the commodity’s correction phase has not been completed yet, for it to resume its multi-year uptrend. We maintain our negative trading bias.

We recommend traders stay in short positions. We initiated these at USD1,938.90, which is the closing level of 10 Aug. For risk-management purposes, a stop-loss can be placed above the USD2,050 threshold.

The immediate support is revised to USD1,950, followed by USD1,930. Meanwhile, resistance points are eyed at the USD2,000 round figure and USD2,030.

Source: RHB Securities Research - 18 Aug 2020