Outlook remains bullish; stay long. The E-mini Dow ended higher to form a white candle yesterday. It gained 87 pts to close at 26,240 pts, off its high of 26,302 pts and low of 26,133 pts. Based on the current technical landscape, we think the buyers may have retained control of the market. This was as yesterday’s white candle has recouped most of the previous session’s losses. Given that the E-mini Dow is holding above the 21-day SMA line, this implies that the rebound that begin with 8 Mar’s “Hammer” pattern may carry on. Overall, we remain upbeat in the index’s outlook.

Based on the daily chart, we maintain the immediate support level at the 26,000-pt psychological mark. If this level is taken out, look to 25,213 pts – determined from the low of 8 Mar’s “Hammer” pattern – as the next support. To the upside, we are eyeing the immediate resistance level at the 26,966-pt historical high. Meanwhile, the next resistance is situated at the 27,000-pt round figure.

Hence, we advise traders to maintain long positions, given that we initially recommended initiating long above the 26,000-pt level on 2 Apr. A stop-loss is advisable to set below the 25,213-pt threshold in order to minimise the downside risk.

Source: RHB Securities Research - 4 Apr 2019