Maintain long positions as the upward move is still intact. The FCPO underwent an intraday negative price reversal. At one point, it reached a high of MYR2,221, before sliding to settle MYR16 lower, at MYR2,185. Despite the negative performance, we still believe the commodity is in the process of extending its uptrend. This came after it completed a multi-week correction between end-August and end-September, where it retested the 200-day SMA line. For now, if this SMA line is not breached, we make no change to our positive trading bias.

As the latest negative session can be seen as a minor pause by the bulls, we continue to recommend that traders stay in long positions, initiated at MYR2,175, the closing level of 9 Sep. To manage risks, a stop-loss can be placed below MYR2,100.

Towards the downside, we are keeping the immediate support at MYR2,177, the high of 8. This is followed by MYR2,100, near the 200-day SMA line. Meanwhile, the immediate resistance is set at MYR2,250, followed by MYR2,312, the high of 26 Aug.

Source: RHB Securities Research - 14 Oct 2019