Stay long, with a new trailing-stop set below the 23,500-pt level. The E-mini Dow’s upward momentum has continued as expected, as the index ended higher last night. It gained 167 pts to close at 24,151 pts, after hovering between a high of 24,259 pts and low of 23,959 pts. On a technical basis, the E-mini Dow has posted another white candle and taken out the 24,086-pt resistance mentioned previously. This indicates that the rebound, which started from 26 Dec 2018’s “Long White Day” candle, may continue. Overall, the bullish outlook should remain intact.

Presently, we anticipate the immediate support level at 23,500 pts, which was near 4 Jan’s high and 8 Jan’s low. If this level is taken out, look to 22,563 pts – ie the previous low of 4 Jan – as the next support. To the upside, we are eyeing the immediate resistance level at 24,844 pts, defined from the high of 12 Dec 2018. If the price breaks out, the next resistance is seen at 26,088 pts, obtained from the previous high of 3 Dec 2018.

To re-cap, on 27 Dec 2018, we initially recommended traders to initiate long positions above the 22,400-pt level. We continue to advise them to stay long for now, while setting a new trailing-stop below the 23,500-pt threshold. This is in order to lock in part of the profits.

Source: RHB Securities Research - 17 Jan 2019