Maintain long positions. Yesterday the FCPO ended slightly negative, after it tested the immediate support of MYR2,238 during the session, with a low of MYR2,234. This was before it rebounded to close at MYR2,259, which was a decline of MYR9. The high was at MYR2,272. While the session was negative – given the immediate support was tested during the session and the commodity rebounding towards the closing – this suggests that the bulls have emerged at that level. As long as this level is not breached at the closing, the commodity may still be able to stage a deeper rebound. On this, we keep to our near-term positive trading bias.

Given the said immediate support is still holding, we are of the view the commodity may still be able to rebound higher – with the bias testing both the 30-day and 50-day SMA lines. We continue to recommend that traders keep to long positions, initiated at MYR2,343 – the closing level of 28 Jun. To manage risks, a stop-loss can be set at MYR2,238.

We keep the immediate support at MYR2,238, the low of 21 Jun. This is followed by MYR2,200. On the flip side, the immediate resistance is now set at MYR2,366, the high of 12 Jun. This is followed by MYR2,413, ie the high of 6 Jun.

Source: RHB Securities Research - 11 Jul 2018