Maintain short positions. Despite a retracement, the COMEX Gold hit a strong support near USD1,750. It began Wednesday’s session at USD1,771.90 and retraced for the rest of the session. It reached the session’s low of USD1,753 before rebounding towards the session’s USD1,781.30 high, and closed at USD1,764.50. Although it bounced off the support near USD1,750, the COMEX Gold may face strong resistance at USD1,800. Coupled with the Bearish Crossover of the 20-day and 50-day SMA lines, the resistance may prevail at the USD1,800 level. The 20-day SMA line is trending lower, and this will exert further selling pressure on the precious metal. As such, the commodity may correct and retest the support level in coming sessions. We keep our negative trading bias until the stop-loss is breached.

We recommend traders to retain the short positions initiated at USD1,809, or the closing level of 22 Nov. To manage trading risks, the stop-loss threshold is fixed at USD1,825.

The immediate support remains at USD1,762.20 – 2 Dec’s low – followed by USD1,750. On the other hand, the first resistance is still pegged at USD1,800, followed by USD1,819.30, or the high of 26 Nov.

Source: RHB Securities Research - 16 Dec 2021