Maintain long positions on the expectation of a rebound. The WTI Crude formed a black candle, this was after it came in near to the downtrend line (as drawn in the chart) in the prior session. The low and high were recorded at USD53.97 and USD56.85. The closing level also again placed the commodity back below the 50-day SMA line. At this juncture, we don’t think the latest negative session is an indication that the rebound leg that started from the area near the immediate support of USD50 has reached an end. Towards the upside, should the said downtrend line be overcome, chances are high that the rebound leg may extend further. Maintain our positive trading bias.

As the bias for the commodity to extend its rebound after the previous weeks’ decline is still valid, we continue to recommend traders stay in long positions. We initiated these at USD57.10, the closing level of 13 Aug. For riskmanagement purposes, a stop-loss can now be placed at USD50.

The immediate support is still kept at USD50, a round figure. This is followed by USD45. Conversely, the immediate resistance is set at USD58.82, which was the high of 31 Jul. This is followed by the USD60.94 mark, or the high of 1 Jul.

Source: RHB Securities Research - 15 Aug 2019