Maintain short positions as there is no clear price reversal signals yet. The FCPO failed to stage a positive followup from the prior session’s encouraging performance. At the closing, the commodity fell MYR15 to settle at MYR1,945. The session’s low and high were at MYR1,940 and MYR1,964. The commodity has been hovering around the MYR1,940 immediate support over the past week or so, without showing any clear directional bias from that level. Towards the upside, a firm upside breach of the MYR1,987 immediate resistance may signal the possibility of a deeper rebound developing. Until this happens, we keep to our negative trading bias.
As the bulls are still not able to generate the required price signal for a deeper rebound, 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.
The immediate support is set at MYR1,940, the low of 27 Nov 2018. This is followed by the MYR1,900 threshold. Moving up, 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 - 9 Jul 2019