Maintain long positions. The COMEX Gold rebounded from the support level on Monday, adding USD2.30 to settle at USD1,780.10. The commodity started the session at USD1,776.10 and rose to the session high of USD1,783.10. However, during the US trading hours, it fell to the USD1,768.20 session low – below the USD1,770 support level. Strong buying interest near this level lifted it higher, and the COMEX Gold closed at USD1,780.10. With the latest price action, the commodity formed a “higher low” pattern, which indicates the likelihood of the prevailing upward movement being extended to test the upside resistances at USD1,805 and USD1,815. Meanwhile, breaking below the USD1,770 level may see it enter a correction phase, trending lower to the 20-day SMA line. We maintain our positive trading bias until the trailing stop is breached.

We recommend traders maintain the long positions initiated at USD1,715.60 on 31 Mar. For risk-management purposes, the trailing-stop threshold is set at USD1,770.

The immediate support remains at USD1,770, and is followed by the USD1,750 round figure. Towards the upside, the nearest resistance is eyed at USD1,805 and followed by the USD1,815 mark.

Source: RHB Securities Research - 27 Apr 2021