Maintain short positions as there are no signs for an end to the weak trend. The FCPO added MYR3 to close at MYR1,944. The session’s low and high were recorded at MYR1,926 and MYR1,952. Overall, the weak price trend that started from the high of MYR2,344 on 7 Feb is still standing. This is despite having observed the weak price trend’s waning momentum over the past two week or so. This phenomena may indicate a bottom building process is taking place. However, to confirm an interim low has been established, the commodity has to breach above the immediate resistance of MYR1,987. Until this happens, we keep to our negative trading bias.

Pending confirmation that an interim low is in place, 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.

Towards the downside, the immediate support is set at the MYR1,900 threshold. This is followed by MYR1,863, the low of 25 Aug 2015. On the other hand, 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 - 15 Jul 2019