Maintain short positions as negative bias is still developing. The WTI Crude performed weakly during the latest trading session, as it formed a black candle that at closing, breached both the 200-day SMA line and the previous immediate support of USD66.86. The black gold generally weakened throughout the session, from a high of USD69.66 to a low of USD65.74, before closing USD2.74 lower at USD66.43. The breakdown from the said SMA line was an extension of the recent weak price trend. While the daily RSI reading of 32.11 is near the oversold threshold, we are keeping our negative trading bias until we see clear price reversal signals.

As the bears continue to press the commodity’s price lower, 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 now be placed at above the USD69.66 mark.

Immediate support is revised to USD64.43, the low of 16 Aug. This is followed by USD61.81, which was the low of 6 Apr. On the other hand, the immediate resistance is now set at USD69.66, the high of the latest session. This is followed by USD72.70, which was the high of 15 Oct.

Source: RHB Securities Research - 24 Oct 2018