Keep to long positions on rebound play. Today we look at the WTI Crude’s long-term chart. Overall, the commodity’s long-term rebound – which started from the low of USD26.05 on 11 Feb 2016 – is still considered valid. This suggests the risk is still low for said low to be re-tested. The WTI Crude has been experiencing a sharp rebound after reaching a low of USD42.36 on 24 Dec 2018. For now, we consider this rebound as a technical correction for the prior sharp decline, which started from the high of USD76.90 on 3 Oct 2018. Further supporting this positive bias is the fact that the commodity recently cracked above the 50-day SMA line. We maintain our long bias.

As the rebound is still showing signs of extension, we continue recommending 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 the breakeven level.

The immediate support is set at USD50.38, which was the low of 14 Jan. This is followed by USD42.36, or the low of 24 Dec 2018. The immediate resistance is expected at USD57.96, which was the high of 16 Nov 2018. This is followed by USD60, a round figure

Source: RHB Securities Research - 19 Feb 2019