Best that traders maintain short positions in line with the ongoing bearish bias. Last Friday’s session was led by the buyers, as the WTI Crude posted a USD0.68 gain to USD70.33. As a result, a white candle was formed, after the commodity oscillated between a low of USD69.84 and high of USD71.66. However, this does not change our negative view, given that the sellers are still dominating market sentiment. As long as the WTI Crude is unable to break above the USD75.27 mark, the bearish bias we detected in the “Bearish Engulfing” candlestick pattern on 11 Jul remains in play.

In line with the ongoing bearish bias, we believe it best that traders maintain short positions, with a stop-loss set above the abovementioned USD75.27. This is in order to minimise the upside risk. For the record, we initially made the short recommendation below the USD72.83 mark on 12 Jul.

Our immediate support stays at USD69.56, which was the high of 17 Apr. If this level is taken out, the following support is found at USD67.16, derived from the high of 14 Jun. Towards the upside, we keep the immediate resistance at USD72.83, located at the high of 22 May. The next resistance is pegged at the USD75.27 threshold, or the low of 4 Nov 2014.

Source: RHB Securities Research - 16 Jul 2018