Maintain long to ride on the rebound. The black gold ended its latest session on a high note, settling USD2.58 higher at USD52.36. The intraday tone was positive, as the WTI Crude generally scaled higher for the whole session – the high and low was registered at USD52.58 and USD49.71. This session marked the seventh consecutive positive close for the commodity. The rebound – which started from the low of USD42.36 on 24 Dec 2018 (after the WTI Crude experienced a steep multi-week retracement) – is also gaining momentum, as its daily RSI has crossed the resistance line (as drawn in the chart) at a reading of 58. As such, we maintain our positive trading bias.

As the rebound’s momentum is picking up and has not flashed out an overbought signal, we continue to recommend traders to keep to long positions. These were initiated at USD49.78, or the closing level of 8 Jan. For risk-management purposes, a stop-loss can be placed at below the USD42.36 level.

The immediate support is expected at USD44.35, which was the low of 2 Jan. Breaking this may see market test the USD42.36 mark, or the low of 24 Dec 2018. Conversely, the immediate resistance is now expected at USD54.55, ie the high of 4 Dec 2018. This is followed by USD57.96, which was the high of 16 Nov 2018.

Source: RHB Securities Research - 10 Jan 2019