Maintain short positions. The COMEX Gold saw selling pressure easing yesterday, rebounding USD1.70 to settle at USD1,835.10. Following a sell-off on Tuesday, the precious metal opened higher at USD1,838.50. It closed at USD1,835.10 after moving narrowly in-between the day high and low of USD1,845.90 and USD1,830.10. Since the selling pressure has subsided, we expect the commodity to move range-bound for further consolidation in the coming sessions. Observing that both the 20- and 50-day SMA lines are moving lower, we think selling pressure will emerge above these lines, which may restrict prices from going higher. Unless the COMEX Gold can surpass the stop-loss level, we maintain our negative trading bias.

We recommend traders shift to short positions. Our short positions were initiated at USD1,833.40, ie the closing level of 2 Feb. For risk-management purposes, a stop loss can be placed at the USD1,867 level.

The immediate support remains at 11 Jan’s low of USD1,817 and followed by USD1,811. Towards the upside, the nearest resistance is pegged at the USD1,850 round figure – this is followed by 28 Jan’s high of USD1,867.

Source: RHB Securities Research - 4 Feb 2021