No end to the retracement yet; maintain short positions. The FCPO continued to weaken in the latest session, at one point, it came in near to test the immediate support of MYR2,095. It ceased MYR9 lower at MYR2,108 – the low and high were posted at MYR2,099 and MYR2,121. The weak session can be seen as the continuation of the previous session’s breakdown from the 200-day SMA and uptrend lines (as drawn in the chart). Overall, the commodity’s latest bout of retracement, which started from the high of MYR2,235 on 5 Apr, is still showing signs of extending. Until signs of a rebound show up, we maintain our negative trading bias.

In the absence of price reversal signals, we continue to recommend that traders stay in short positions. We initiated these at MYR2,154, the closing level of 11 Apr. To manage risks, a stop-loss can be placed at the breakeven level.

The commodity may be found at the immediate support of MYR2,095, the low of 29 Mar. This is followed by MYR2,038, the low of 15 Mar. Towards the upside, the immediate resistance is expected at MYR2,235, the high of 5 Apr – followed by MYR2,344, the high of 7 Feb.

Source: RHB Securities Research - 30 Apr 2019