Maintain short position while moving the trailing stop to breakeven level. The WTI Crude ceased the latest session on a soft note at USD55.06, implying a decline of USD0.48. The low and high were recorded at USD54.42 and USD55.73. The weak closing means the weak price actions that set in after the black gold came in near to test the 200-day SMA line and the immediate resistance of USD57.02 recently is still in place. It worth noting that the commodity has been struggling to stay above the said SMA line over the past months – indicating it is a strong resistance level. We maintain our negative trading bias.

As the retracement is still showing signs of progress, we continue to recommend traders stay in short positions. For risk management purposes, a stop-loss can now be placed at the breakeven level.

Immediate support is expected to emerge at USD52.39, or the low of 12 Oct. This is followed by USD50.00, a round figure. Meanwhile, the immediate resistance is set at USD57.02, ie the high of 25 Sep. This is followed by USD59.54, which was the high of 19 Sep.

Source: RHB Securities Research - 31 Oct 2019