Maintain short positions. The COMEX Gold, as expected, moved sideways for another session. The precious metal started the session at USD1,873.50, dipped to the low of 1,867.20 and rebounded to test the high of 1,889.50. It failed to hang on to the intraday gains, and retraced to settle at USD1,882.60. For the past three sessions, we observed selling pressure near 1,894.90 and buying pressure near the low of 1,868.10. With the RSI still trending below the threshold of 50%, we think that the precious metal will maintain this pattern, building a sideway base within these two bands. A breakout from either side of the bands or boundary will see a formation of a new trend. Since it is trading below 20-day SMA line, we maintain our negative trading bias.

We recommend traders maintain short positions. We initiated these at USD1,860.60, which was 9 Nov’s closing level. For risk-management purposes, the stop-loss can be set above USD1,895.40, or the low of 3 Nov.

The downside support is marked at USD1,860.20, followed by USD1,851, ie the low of 24 Sep. On the upside, the resistance point is pegged at the recent USD1,894.90 high and followed by USD1,924, which was the high of 4 Nov.

Source: RHB Securities Research - 13 Nov 2020