Maintain long positions as the bulls charge ahead. The FCPO extended its rebound in the latest session. At the closing, it added MYR30 to end at MYR2,059. The intraday tone was positive, as it generally trended higher for the whole session – the low and high were recorded at MYR2,022 and MYR2,062. The positive session is an extension of the prior session’s breakout from the 50-day SMA line. This positive bias would be further enhanced should the commodity be able to breach above both the immediate resistance of MYR2,059, and downtrend line (redrawn as shown in the chart) in the coming sessions. Considering these, we keep to our positive trading bias.

As the countertrend rebound continues to assert itself, we stay with our recommendation for traders to maintain long positions. We initiated these at MYR2,029, the closing level of 24 Jul. For risk management purposes, a stop-loss can be placed below the MYR1,978 level.

The immediate support is set at MYR1,978, which was the low of 23 Jul. This is followed by MYR1,916, the low of 10 Jul. Moving up, the immediate resistance is now pegged at the MYR2,059 threshold, the high of 18 Jun. This is followed by MYR2,115, which was the high of 29 May.

Source: RHB Securities Research - 26 Jul 2019