Maintain long positions as the rebound could still carry on. The black gold failed to maintain its earlier session’s gains. At the closing, it settled USD0.23 lower at USD60.20. Trading took place in the range of USD60.14-60.94. The weak session can be seen as just a sign that bulls are taking a pause – after a relatively sharp upward move in the previous session. For now, as long as the immediate support of USD56.04, which is also located near the 200-day SMA line, is not breached on the downside, the overall positive bias is expected to hold. Maintain our positive trading bias.

As the rebound may still extend, we recommend traders stay in long positions. We initiated these at USD60.43, the closing level of 11 Jul. For risk-management purposes, a stop-loss can be placed below the USD56.04 mark, which was the low of 3 Jul.

The immediate support is set at USD56.04, ie the low of 3 Jul. This is followed by USD54.84, which was the high of 10 Jun. Towards the upside, the immediate resistance is set at USD63.81, or the high of 20 May. This is followed by USD66.60, which was the high of 23 Apr.

Source: RHB Securities Research - 12 Jul 2019