Maintain long positions. The FCPO ended the latest session in the negative territory, after three sessions of advancement. For the session, the commodity clocked a low and high of MYR2,316 and MYR2,348, before ending at MYR2,326, implying a loss of MYR17. We see the weak session as merely a sign of possible consolidation after the recent upward moves. For now, as long as it continues to stay above MYR2,238, the bias for the commodity to extend its rebound would remain in place. At the minimum, we are expecting the rebound to test both the 30-day and 50-day SMA lines. On this, we maintain our near-term positive trading bias.

Given that the commodity’s latest weak session was merely an early sign of a possible short-term consolidation and that the overall rebound since the low of MYR2,238 is still valid, we maintain our recommendation for traders to keep to the long positions that we initiated at MYR2,343 – the closing level of 28 Jun. To manage the risk, a stoploss can be set at MYR2,238.

We maintain the immediate support at MYR2,238, the low of 21 Jun. This is followed by MYR2,200, or the next round figure. 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 - 2 Jul 2018