Maintain long positions as another resistance has been breached. The FCPO continued to scale higher in the latest session and, at the closing, decisively crossed above the previous immediate resistance of MYR2,344. Trading ranged between MYR2,328 and MYR2,408, before the commodity closed at MYR2,382, indicating a good gain of MYR62. The positive performance continues to reinforce our view that the commodity is extending its multi-month uptrend. This came after it completed a multi-week correction at the end of September. While its RSI points to an overbought reading, we make no change to our positive trading bias, in the absence of a price reversal signal.

Since the positive trend is still developing, traders are recommended to stay in long positions. These were initiated at MYR2,175, the closing level of 9 Sep. To manage risks, a stop loss can now be placed below MYR2,263.

The immediate support is revised to MYR2,263, which was the low of 22 Oct, followed by MYR2,221, the high of 11 Oct. Towards the upside, immediate resistance is now eyed at MYR2,400, followed by MYR2,457, which was the high of 4 June 2018.

Source: RHB Securities Research - 25 Oct 2019