Maintain long positions. The COMEX Gold rebounded higher last Thursday, rising USD5.10 to settle at USD1,883.20. The precious metal opened lower at USD1,877.30, finding footing near the day low at USD1,873.10. Despite a quiet market on Christmas eve, higher demand for the commodity pushed the price towards the day high of USD1,887.40, before closing at USD1,883.20. Since the COMEX Gold is trading above the 50-day SMA line, we think the buying power of the bulls is greater than the selling power of the bears. Coupled with the RSI pointing upwards, we also believe the immediate-term momentum tends to be bullish. Premised on this, we stick to our positive trading bias.

We recommend traders maintain long positions. We initiated long positions at USD1,859.10, or the closing level of 16 Dec. For risk-management purposes, a stop loss can be set below the USD1,848 level.

The downside support is unchanged at the recent low of USD1,859 and followed by USD1,820. On the upside, the immediate resistance is pegged at the high of 18 Dec – USD1,895.70 – and followed by the high of 3 Nov, ie USD1,912.20.

Source: RHB Securities Research - 28 Dec 2020