Maintain short positions as there is no sign the retracement is ending. The WTI Crude ended the latest session relatively unchanged. Intraday, the commodity ranged between USD68.27 and USD69.65, before closing at USD69.17, which implies a marginal gain of USD0.05. The latest closing continues to place the commodity below both the uptrend line (as drawn in the chart) and the 50-day SMA line – indicating the bias is still negative. Additionally, the daily RSI reading of 40.29 is also suggesting the commodity’s lack of strength. Based on these, we are keeping our negative trading bias.

As there are no signs that the recent retracement has reached an end, we continue to recommend that traders keep to short positions. We initiated short positions at USD70.97, which was the closing level of 11 Oct. For risk management purposes, a stop-loss can be placed at the breakeven level.

Immediate support is pegged at USD66.86, which was the low of 7 Sep. The following support is at USD64.43, the low of 16 Aug. Conversely, the immediate resistance is now at USD75.27, ie the high of 3 Jul. This is followed by USD76.90, or the high of 3 Oct.

Source: RHB Securities Research - 23 Oct 2018