Maintain long positions. The E-mini Dow ended higher to form a white candle last Friday. It rose 169 pts to close at 26,002 pts, off its high of 26,044 pts and low of 25,805 pts. Technically speaking, investor sentiment remains bullish, since the index has recouped the previous session’s losses and marked a higher close above the rising 21-day SMA line. Last Friday’s white candle can also be viewed as a continuation of the upside swing that began with 8 Feb’s “Hammer” pattern. Overall, we stay bullish on the E-mini Dow’s outlook.

Based on the daily chart, we maintain the immediate support level at 24,862 pts, ie the low of 8 Feb’s “Hammer” pattern. Meanwhile, the next support is anticipated at 24,284 pts, situated near the lows of 23 and 28 Jan. Towards the upside, the immediate resistance level is seen at 26,268 pts, which was the high of 8 Nov 2018. If this level is taken out, the next resistance is set at the 26,966-pt record high.

Therefore, we advise traders to maintain long positions, following our recommendation of initiating long above the 22,400-pt level on 27 Dec 2018. In the meantime, a trailing-stop can be set below the 24,862-pt mark in order to secure part of the gains.

Source: RHB Securities Research - 25 Feb 2019