Maintain long positions. The WTI Crude formed a “Hammer” candlestick pattern during yesterday’s trading – this was because the commodity managed to reverse most of its intraday loss towards the end of the session. The low and high were registered at USD55.42 and USD56.40, before closing at USD56.22 – implying a decline of USD0.34. The price pattern that has been developing over the past two weeks is still showing a sideways consolidation pattern below the USD57.96 immediate resistance. Until there are signs this bias for a sideways consolidation is invalidated, we maintain our long bias.

As there are no indications that suggest the WTI Crude’s rebound – which started from the low of USD42.36 on 24 Dec 2018 – has exhausted, we continue to recommend traders maintain long positions. These were initiated at USD49.78, or the close of 8 Jan. For risk-management purposes, a trailing-stop can be placed below the USD53.08 level.

The immediate support is set at USD50.38, which was the low of 14 Jan. The second support is pegged at USD42.36, or the low of 24 Dec 2018. Moving up, 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 - 7 Mar 2019