Stay long, with a trailing-stop set below the 24,284-pt support. The buying momentum in the E-mini Dow has continued on as expected, as a long white candle was formed last night. This points towards a continuation of the upside move. It gained 389 pts to close at 25,406 pts, off its high of 25,439 pts and low of 25,002 pts. On a technical basis, we think the buyers may have retained control of the market. This was as yesterday’s long white candle has recouped the previous three days’ losses. Given that the E-mini Dow has taken out the 25,387-pt resistance mentioned previously, this has enhanced the bullish sentiment.

Based on the daily chart, we are eyeing the immediate support level at 24,284 pts, defined near the lows of 23 and 28 Jan. Meanwhile, the next support is maintained at the 24,000-pt psychological spot. Towards the upside, the immediate resistance level is now seen at 26,088 pts, ie the previous high of 3 Dec 2018. If this level is taken out, the next resistance is situated at the 26,966-pt historical high.

Thus, we advise traders to maintain long positions, given that we initially recommended initiating long above the 22,400-pt level on 27 Dec 2018. In the meantime, a trailing-stop can be set below the 24,284-pt threshold in order to lock in part of the profits.

Source: RHB Securities Research - 13 Feb 2019