Maintain short positions. The COMEX Gold continued to move higher yesterday, climbing USD4.90 to settle at USD1,721.80. After the session started at USD1,714.50, selling pressure – seen throughout most of the session – dragged the commodity towards the USD1,705.60 session low. Moving into US pre-market hours, the COMEX Gold jumped to the session high of USD1,725.30 before settling in at USD1,721.80. Since the RSI indicator has surpassed the downtrend line, selling pressure has eased and will likely see a positive momentum follow-through. The precious metal is looking to test the resistance near the 20-day SMA line or, at least, the high of 3 Mar, ie USD1,739.10. Meanwhile, if the commodity fails to sustain above the USD1,700 physcological level, downward movement will resume. Due to the still-intact trailing stop, we keep to our negative trading bias.

We recommend traders stick to the short positions initiated at USD1,799, or the closing level of 16 Feb. For riskmanagement purposes, the trailing stop remains at USD1,725.

The immediate support is marked at USD1,700 and followed by 8 Mar’s low of USD1,673.30. Towards the upside, the resistance is pegged at 3 Mar’s high of USD1,739.10 and followed by the round figure of USD1,750.

Source: RHB Securities Research - 11 Mar 2021