Market hit new historical high; stay long. The E-mini Dow’s upside strength continued as expected after it ended higher to form a long white candle last night. It gained 237 pts to close at 27,667 pts, off the session’s low of 27,390 pts. As the index has successfully taken out the previously indicated 27,493-pt resistance and hit its new historical high, this can be viewed as the buyers extending their buying momentum. Overall, we remain upbeat on the E-mini Dow’s outlook.

Presently, the immediate support level is maintained at 26,847 pts, which was the low of 31 Oct. If a breakdown arises, the next support is seen at 26,588 pts, obtained from the low of 23 Oct’s “Hammer” pattern. To the upside, we now anticipate the near-term resistance level at the 28,000-pt psychological spot. This is followed by the 28,500- pt round figure.

Therefore, we advise traders to maintain long positions, given that we initially recommended initiating long above the 26,750-pt level on 16 Oct. A trailing stop set below the 26,847-pt threshold is advisable in order to minimise the downside risk.

Source: RHB Securities Research - 8 Nov 2019