Maintain short positions until a clearer rebound emerges. The FCPO managed to post an intraday reversal in the latest trading, registering a marginal gain of MYR2 to close at MYR1,985. The low and high were at MYR1,960 and MYR1,986. The intraday reversal came after the commodity’s recent weeks’ retracement sent its Daily RSI into an oversold reading recently. Should there be a positive follow-through in the coming sessions, it may signal the commodity’s retracement has reached, at the minimum, an interim low. Until we see signs of this, we maintain our negative trading bias.

Until there is confirmation that a stronger rebound is developing, traders can remain in short positions. We initiated these at MYR2,154, the closing level of 11 Apr. To manage risks, a stop-loss can be placed above MYR2,058, the high of 8 May.

Towards the downside, immediate support is eyed at MYR1,940, the low of 27 Nov 2018. This is followed by MYR1,900. Meanwhile, the immediate resistance is revised to MYR2,058, the high of 8 May. This is followed by MYR2,124, the high of 30 Apr.

Source: RHB Securities Research - 14 May 2019