Maintain long positions as the commodity is likely resuming its upward move. The FCPO formed an “Upside Gap” yesterday, and closed MYR21 higher, at MYR2,196. Trading ranged between MYR2,188 and MYR2,206. Overall, we still believe the commodity’s multi-week correction, which happened in 26 Aug-30 Sep, has completed – with the retesting of the 200-day SMA line. As such, chances are high that the commodity is in the process of extending its upward move. This positive bias would remain in place, if the SMA line is not breached. We maintain our positive trading bias.

As the commodity had a positive follow-up in the latest session, 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.

We revised the immediate support to MYR2,177, which was the high of 8. This is followed by MYR2,100, near the 200- day SMA line. Moving up, the immediate resistance is expected at MYR2,250, followed by MYR2,312, the high of 26 Aug

Source: RHB Securities Research - 15 Oct 2019