Maintain short positions. The WTI Crude ended the latest session lower by USD0.55 at USD67.04. This was after it generally trended lower during the session, with the high and low posted at USD67.95 and USD66.29. Price actions over the latest four sessions showed that the commodity is consolidating around the 200-day SMA line ie no signs that it is ready to rebound from this important SMA line yet. Towards the downside, a breakdown from this consolidation phase would likely signal the extension of the weak price trend. On the upside, for a deeper rebound to develop, the said SMA line would need to be recaptured decisively first. Until this happens, we are keeping our negative trading bias.

The bias is still skewed towards a downtrend extension hence 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.

We still peg the immediate support at 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 expected at USD69.66, the high of 23 Oct. This is followed by USD72.70, which was the high of 15 Oct.

Source: RHB Securities Research - 30 Oct 2018