Gold prices moved higher on Monday, with RHB Investment Bank Bhd (RHB Research) maintaining its long position on the precious metal as a weaker US dollar and fading expectations of a September Federal Reserve rate hike supported bullish momentum.
RHB Research said COMEX gold recovered US$16.40 on Friday to close at US$4,403.70, after trading between a low of US$4,333 and a high of US$4,420.80. The research house said the fresh bullish candlestick suggested selling pressure had eased, with the yellow metal potentially resuming its upward trajectory towards US$4,650.
A break above that level could extend gains towards the next resistance at US$4,900, RHB Research said, while maintaining its positive trading bias. The research house advised traders to retain the long position initiated at US$4,273.30, while revising its stop-loss level to US$4,300 from US$4,100.
Separately, Reuters reported that spot gold rose 0.6% to US$4,400.15 per ounce as the US dollar index slipped 0.2%, making dollar-priced bullion more affordable for other currency holders.
Recent US data showing an unexpected decline in July nonfarm payrolls alongside mild consumer price inflation has also reduced expectations of a September rate hike. Traders are now pricing in a 29% chance of a hike, down from 47% a month earlier, according to CME’s FedWatch Tool.
RHB Research identified US$4,300 as the nearest support, followed by US$4,100, while US$4,650 and US$4,900 remain the key resistance levels.
