No end to retracement; maintain short positions. The FCPO extended its weakening bias into the latest session and, in the process, came close to testing the immediate support level of MYR2,000. The commodity reached a low and high of MYR2,006 and MYR2,046 before closing at MYR2,010, indicating a drop of MYR22. While the retracement is now flashing out an oversold Daily RSI reading and nearing the said immediate support, there are no price signals that could suggest the retracement leg that started from the high of MYR2,344 on 7 Feb has reached an end. As such, we maintain a negative trading bias.

As the weak price trend is still not showing signs of reversing, 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 now be placed at above MYR2,124.

Towards the downside, immediate support is pegged at MYR2,000, followed by MYR1,940, the low of 27 Nov 2018. Meanwhile, the immediate resistance is set at MYR2,124, the high of 30 Apr. This is followed by MYR2,235, the high of 5 Apr.

Source: RHB Securities Research - 6 May 2019