Maintain long positions as the bulls have managed to recoup most losses. The FCPO experienced a relatively wide trading range in the latest session, which at the closing, witnessed the commodity recouped significant portion of its intraday losses. The low and high were recorded at MYR2,806 and MYR2,877, before closing MYR20 weaker at MYR2,858. The strong intraday rebound from the low suggests the bulls are still in control over the price trend. Towards the downside, provided the latest session’s low is not breached, the risk for the commodity to experience a deeper correction is still contained. Hence, we keep to our positive trading bias.

In the absence of a confirmed price exhaustion signal, traders are advised to remain in long positions. These were initiated at MYR2,175, the closing level of 9 Oct. To manage risks, a stop-loss can now be placed below MYR2,806.

The immediate support is revised to MYR2,806, the latest session’s low. This is followed by MYR2,685, the low of 2 Dec. Towards the upside, the immediate resistance is pegged at MYR2,986, the high of 16 February 2017. This is followed by MYR3,075, the high of 15 February 2017.

Source: RHB Securities Research - 19 Dec 2019