Bears are still not letting go; maintain short positions. The FCPO softened last Friday, decreasing by MYR11 to close at MYR1,972. Trading ranged between MYR1,965 and MYR1,984. The weak session implies that the overall downtrend – which started from the high of MYR2,344 on 7 Feb – is still not showing signs of ending. The recent minor rebound is counter-trend in nature. Additionally, the commodity is still capped by the 50-day SMA line – a trend line that it has been struggling to overcome YTD. We maintain our negative trading bias.

In the absence of a clear price signal to indicate that the commodity may be staging a stronger rebound, we continue to recommend that traders stay in short positions. These were initiated at MYR1,951, the closing level of 28 Jun. We revise the stop-loss to above MYR2,015.

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 revised to MYR2,015, near the high of 24 Jun. This is followed by the MYR2,059 threshold, the high of 18 Jun.

Source: RHB Securities Research - 22 Jul 2019