Maintain short positions. The COMEX Gold saw a volatile session yesterday, falling USD11.20 to settle at USD1,873.90. The bears dominated the session. The precious metal started the session lower at USD1,879.50 before rising to the day high of USD1,884.20 – this was where the bears started pounding down towards a USD1,860.30 day low. The bulls seized the opportunity to buy from low, pushing the commodity to a day-high level again. This effort proved futile, as the bulls lost steam in the final trading hour, which saw the COMEX Gold retracing to USD1,873.90. We can see the bears gripping the commodity price trend, in tandem with the RSI, which is pointing downwards. The next three sessions will be crucial, as the 20-day SMA line will tilt lower, which will exert extra selling pressure on the COMEX Gold. Hence, we maintain our negative trading bias.

We recommend traders keep to short positions. We initiated these at USD1,860.60 on 9 Nov. For riskmanagement purposes, the stop-loss can be set above USD1,892.70, or the high of 17 Nov.

The downside support is sighted at USD1,860.30 and followed by USD1,851, ie 24 Sep’s low. On the upside, the immediate resistance is pegged at USD1,892.70 and followed by USD1,917.90, which was 4 Nov’s high.

Source: RHB Securities Research - 19 Nov 2020