Maintain short positions as the correction phase may still be extending. Yesterday’s trading saw the FCPO managing to halt its recent weak sessions. At the closing, it added MYR6 to settle at MYR2,147 – the low and high were posted at MYR2,135 and MYR2,159. However, we consider the latest positive performance as just a minor pause – this has not altered the commodity’s weak bias, which resumed on the failed attempt to cross the MYR2,300 level on 17 Sep. So far, the retracement has not reach an oversold condition yet. Hence, we keep to our negative trading bias. On the bias that the commodity’s correction phase has not reached an end, we continue to recommend that traders stay in short positions. These were initiated at MYR2,245, which was the closing level of 19 Sep. To manage risks, a stop-loss can now be placed at the breakeven level. The immediate support is set at MYR2,100, near the 200-day SMA line. This is followed by MYR2,000, a round figure. On the other hand, the immediate resistance is still pegged at MYR2,312, which was the high of 26 Aug. This is followed by MYR2,344, or the high of 7 Feb.

Source: RHB Securities Research - 26 Sept 2019