Maintain long positions to ride the rebound. The WTI Crude ceased the latest session weaker by USD0.47 to settle at USD53.31. Session’s low and high were posted at USD52.71 and USD54.03. The negative session occurred after the commodity came in near to test the immediate resistance of USD54.84 in the prior session. However, we are not seeing the latest weak performance as a signal that the rebound that started from an area near the USD50 immediate support has reached an end. Towards the upside, a firm breakout from the said immediate resistance would likely see the commodity retesting the 200-day SMA line. Maintain our positive trading bias.

On the ground that the rebound could still be extending towards the 200-day SMA line, 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. Meanwhile, the immediate resistance level is expected to emerge 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 - 22 Oct 2019