Maintain long positions on expectation for rebound extension. The WTI Crude settled the latest session weaker by USD0.18 at USD59.02. This came after it reached a low and high of USD58.23 and USD59.25. Despite the negative session, the black gold still managed to hold above the 200-day SMA line. The ability for it to trade above the said SMA line is crucial given the observation that it has been facing difficulty in crossing and holding above this level over the past months. Maintain our positive trading bias.

As the bulls are still able to maintain prices above the 200-day SMA line, we maintain our advice for traders to stay in long positions. We initiated these at USD59.20, the closing level of 6 Dec. For risk management purposes, a stop-loss can be placed below USD54.76.

Immediate support is eyed at USD54.76, which was the low of 20 Nov’s “Bullish Engulfing” formation. This is followed by USD52.39, or the low of 12 Oct. Towards the upside, the immediate resistance is set at USD63.38 – the high of 16 Sep, followed by USD66.60, the high of 23 Apr.

Source: RHB Securities Research - 10 Dec 2019