Initiate long positions. The FCPO ceased the latest session on a positive tone and, at the close, successfully breached above the previous immediate resistance of MYR2,336. The session’s low and high were recorded at MYR2,305 and MYR2,344 respectively, before the commodity closed at MYR2,343 – a gain of MYR28. With the upside break of the aforementioned previous immediate resistance, the FCPO may now pose a deeper rebound in the near term – with the minimum rebound target of testing both the 30- and 50-day SMA lines. This came after it reached an oversold daily RSI reading of 25.5 on 21 Jun. On this, we switch our near-term trading bias to positive.

Our previous short positions, initiated at MYR2,263 or the closing level of 19 Jun, were closed out in yesterday’s trading at MYR2,336. Given that a deeper rebound is likely to develop, we now initiate short positions on yesterday’s close. To manage the risk, a stop-loss can be set at MYR2,238

We revise the immediate support to MYR2,238, the low of 21 Jun. This is followed by MYR2,253, or the low of 26 Jul 2016. Towards the upside, the immediate resistance is now set at MYR2,366, which was the high of 12 Jun. The second resistance is at MYR2,413, ie the high of 6 Jun.

Source: RHB Securities Research - 29 Jun 2018