Maintain short positions as the negative bias is still not showing signs of ending. The FCPO formed a black candle and, at the closing, settled slightly below the previous immediate support of MYR1,940. The session’s low and high were posted at MYR1,916 and MYR1,956, before it closed at MYR1,938 – indicating a decline of MYR4. Overall, the soft commodity’s weak price trend that started from the high of MYR2,344 on 7 Feb is still showing signs of developing. This bias would stay valid as long as the bulls are capped by the immediate resistance of MYR1,987. We maintain our negative trading bias.

As the negative price trend is still showing signs of extending, we continue to recommend that traders stay in short positions. These were initiated at MYR1,951, the closing level of 28 Jun. A stop-loss can now be placed above MYR1,987, the high of 27 Jun.

We revised the immediate support to the MYR1,900 threshold. This is followed by MYR1,863, the low of 25 Aug 2015. Meanwhile, the immediate resistance is set at MYR1,987, the high of 27 Jun. This is followed by MYR2,059, the high of 18 Jun.

Source: RHB Securities Research - 11 Jul 2019