Maintain long positions. The Black Gold formed a white candle in the latest session, which at the closing crossed above the previous resistance zone – consisting of the 200-day SMA and the downtrend lines (as drawn on the chart). Trading took place between USD56.58 and USD58.16, before closing at USD57.85, indicating a gain of USD1.33. The breakaway from the said resistance zone is positive – after multiple attempts over the recent weeks. This implies the probability is high for the commodity to extend its rebound phase – which started from an area near the USD50 support level. Maintain our positive trading bias.

As the bulls managed to signal an extension of the said rebound phase, we continue to recommend traders stay in long positions. We initiated these at USD57.10, or the closing level of 13 Aug. For risk-management purposes, a stop loss can now be placed below the USD52.84 mark.

Immediate support is expected at USD52.84, ie the low of 3 Sep. This is followed by the USD50 round figure. Towards the upside, 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 - 10 Sept 2019