Best to stay in short positions as bearish bias is still in play. Presently, the WTI Crude is trading at around USD69.93. We highlight a “Bearish Harami” candlestick on 31 Aug, suggesting that the over 2-week upside bias is nearing its limit. Overall, our bearish view remains in play, given that no strong upside development was sighted. As long this level is not taken out, we believe that the bearish bias since the appearance of 11 Jul’s “Bearish Engulfing” candlestick pattern has not been fully negated yet.

The daily chart above suggests that the WTI Crude is still being pressed below the USD71.10 mark. As such, it is best that traders maintain short positions. For risk-control purposes, we advise setting a stop-loss above the abovementioned USD71.10. Recall that we initially made the short call on 12 Jul, after the commodity dropped below the USD72.83 threshold.

Our immediate support is maintained at USD67.03, or the low of 17 Jul. This is followed by the next support at USD64.22, obtained from the low of 5 Jun’s “Bullish Harami” pattern. Conversely, we set the immediate resistance at USD71.10, which was the high of 20 Jul. The next resistance is pegged at the USD75.27 threshold, derived from the high of 3 Jul.

Source: RHB Securities Research - 4 Sept 2018