Maintain short positions. The latest session saw the FCPO form a white candle and successfully recapture the previous immediate resistance of MYR2,253 – suggesting the bulls were in control of the day. The session’s low and high were at MYR2,250 and MYR2,289, before closing at MYR2,284, which is a gain of MYR35. The positive price action came in after the daily RSI reached the oversold level of 25.5 in the previous session. However, we believe further positive price development is needed to signal a possibility for a deeper rebound to take place. Until that happens, we keep to our near-term negative trading bias.

The latest session’s positive price action is not sufficient to suggest a possible price rebound is in the making. As such, we continue to advise traders to keep to short positions – initiated at MYR2,263, the closing level of 19 Jun. For risk management purposes, a stop-loss can be set at above MYR2,336.

We revise the immediate support to MYR2,253, the low of 26 Jul 2016. This is followed by MYR2,186, which is the low of 12 Jul 2016. On the upside, the immediate resistance is now set at MYR2,336, the high of 14 Jun. This is followed by MYR2,413, the high of 6 Jun.

Source: RHB Securities Research - 25 Jun 2018