Maintain long positions while revising the trailing-stop to breakeven point. The FCPO extended its rebound in the latest session to close MYR39 higher at MYR2,105. The low and high were recorded at MYR2,082 and MYR2,115. The positive session indicates that the commodity’s counter-trend rebound is not showing signs of ending yet. If the immediate resistance of MYR2,124 be overcome in the coming sessions, the bulls may advance towards the 200-day SMA line for a retest. To recap, this rebound phase set in after the commodity experienced a relatively sharp multi-week retracement which saw its Daily RSI reaching an oversold level recently. Based on this, we keep to our positive trading bias.

In the absence of price reversal signals that could indicate the resumption of the commodity’s weak price trend, traders are advised to remain in long positions. This was initiated at MYR2,086, the closing level of 16 May. To manage risks, a stop-loss can be placed at the breakeven level.

Immediate support is eyed at MYR1,940, the low of 27 Nov 2018. This is followed by the MYR1,900 threshold. On the other hand, the immediate resistance is expected at MYR2,124, the high of 30 Apr. The following resistance is pegged at the MYR2,200 level.

Source: RHB Securities Research - 30 May 2019