No reversal signs, keep to short positions. Yesterday, the FCPO breached the previous immediate support level of MYR2,324 and tested the MYR2,300 support. For the intraday, the commodity swung between a low and high of MYR2,300 and MYR2,322 respectively, before ending MYR10 lower at MYR2,316. The negative session continues to suggest that the commodity’s negative price trend is still developing, and is not showing any clear sign of reversing – even though the RSI reading of 31 is close to the oversold threshold. The weak trend is further evidenced by both the 30-day SMA and 50-day SMA lines which continue edge lower. Hence, we maintain our negative near-term trading bias.

We continue to recommend that traders keep to short positions. We initiated such a position at MYR2,365, ie the closing level on 8 Jun. To manage risks, we now set the stop-loss to above MYR2,324.

We revise the Immediate support to MYR2,300. This is followed by MYR2,253, the low of 26 Jul 2016. On the other hand, the immediate resistance is now at MYR2,324, the low of 4 May. This is followed by MYR2,413, the high of 6 Jun.

Source: RHB Securities Research - 14 Jun 2018