Upward move seems more likely; maintain long positions. The FCPO formed an “Upside Gap” to settle MYR38 stronger at MYR2,252, which marginally crossed above the previous immediate resistance of MYR2,250. Trading ranged between MYR2,236 and MYR2,260. The relatively strong session, which came after the commodity filled the 9 Oct’s “Upside Gap” two session ago, indicates that the bulls are in a firm control. Overall, we believe the commodity is in the process of extending its upward move. This came after it underwent a multi-week correction phase between endAugust to end-September. Our positive bias would stay, provided the 200-day SMA line is not breached.   

With the upward move is showing firmer signs of extending, 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.   

The immediate support is revised to MYR2,140, which was the low of 15 Oct. This is followed by MYR2,100, near the 200-day SMA line. Moving up, the immediate resistance is now set at MYR2,312, the high of 26 Aug. This is followed by MYR2,344, the high of 7 Feb.

Source: RHB Securities Research - 17 Oct 2019