Maintain long positions as the bulls are in strong control despite being overbought. The FCPO continued to advance in the latest session – despite its Daily RSI indicating an overbought reading. At the closing, the soft commodity added MYR33 to close at MYR2,212. The session’s low and high were posted at MYR2,188 and MYR2,217. As the commodity continued to extend its upward move beyond the 200-day SMA line, the overall positive price trajectory is still firmly intact – without signs of a consolidation or price exhaustion. This is despite the overbought situation. As such, we keep to our positive trading bias.

As the bulls are still in firm control, traders are advised to remain in long positions. We initiated these at MYR2,029, the closing level of 24 Jul. To manage risks, a stop-loss can be placed below the MYR2,049 level.

The immediate support is pegged at MYR2,049, the low of 31 Jul. This is followed by MYR1,916, the low of 10 Jul. On the other hand, the immediate resistance is now set at MYR2,235, the high of 5 Apr. This is followed by MYR2,344, which was the high of 7 Feb.

Source: RHB Securities Research - 14 Aug 2019