Maintain short positions. The COMEX Gold saw a bearish session yesterday, falling USD12.40 to settle at USD1,861.50. The bears were gripping the commodity – selling pressure emerged on every intraday rebound. The precious metal started the session at USD1,872. The bulls were missing from action, with the commodity dipping to the day low of USD1,850. The bulls came in at a late hour to buy at a low, pushing the commodity to close higher at USD1,861.50. This showed that the downtrending of the 20-day SMA line is affecting sentiment, adding selling pressure to the commodity. With the RSI staying below the 50% threshold, the commodity will see more consolidation between the key level of USD1,851-USD1,860. With commodity trading below both moving averages, we maintain our negative trading bias.

We recommend traders hold on 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 and followed by USD1,851, or 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 - 20 Nov 2020