Maintain long positions, as prices continue to scale higher above the 200-Day SMA line. The WTI Crude formed a white candle to end the latest session USD0.89 stronger at USD60.07. The low and high were recorded at USD59.27 and USD60.48. This positive session placed the commodity further above the 200-day SMA line – indicating a positive bias. Recall that prices have been struggling to hold above said SMA line over the past months. As such, as long the black gold is still able to hold above this line, we are keeping our positive trading bias.

In the absence of adverse price actions from the aforementioned SMA line, we maintain our advice for traders to stay in long positions. We initiated these at USD59.20, or the closing level of 6 Dec. For risk management purposes, a stop-loss can be placed below the USD54.76 threshold.

The immediate support is revised to USD57.70, which was the low of 6 Dec. This is followed by USD54.76 – the low of 20 Nov’s “Bullish Engulfing” formation. Towards the upside, the immediate resistance is set at USD63.38, or the high of 16 Sep. This is followed by USD66.60, ie the high of 23 Apr.

Source: RHB Securities Research - 16 Dec 2019