Maintain long positions despite still being capped by the immediate resistance level. The WTI Crude failed to sustain its intraday gains, which at one point saw it testing the immediate resistance of USD54.84 with a high of USD54.90. From there, it slid to close USD1.11 weaker at USD53.59. Despite the negative price reaction from the said immediate resistance area, at this juncture, there is no firm technical evidence to indicate a possible price reversal. As such, we believe the rebound that kicked in, from an area near the USD50 support level, is still likely to extend. Towards the upside, we are expecting the rebound to at least reach the 200-day SMA line. We stick to our positive trading bias.

As the case for the rebound to extend is still strong, we maintain our recommendation for traders to stay in long positions. We initiated these at USD53.55, which was the closing level of 10 Oct. For risk-management purposes, a stop loss can be placed below the USD50.00 mark.

Immediate support is pegged at USD50.00, a round figure. This is followed by USD47.78, which was the high of 2 Jan. On the other hand, overhead resistance is set at USD54.84, or the high of 1 Oct. This is followed by USD57.02, ie the high of 25 Sep.

Source: RHB Securities Research - 15 Oct 2019