Maintain long positions. The FCPO ended the latest session marginally higher by MYR1 at MYR2,903 – after it swung between a low and high of MYR2,875 and MY2,929. Broadly, the soft commodity’s multi-week uptrend is still firmly in place. This is because we are not seeing signs of price exhaustion that could open the door for a correction phase to happen, even though the RSI is flashing an overbought reading. Its 200-day SMA line, which continues to trend higher, also points to a positive trend. Premised on this, we keep to our positive trading bias.

As the bulls still have firm control over the price trend, traders should remain in long positions. These were initiated at MYR2,175, the closing level of 9 Sep. To manage risks, a stop-loss can be placed below MYR2,685.

We are keeping the immediate support at MYR2,685, the low of 2 Dec, followed by MYR2,558, the low of 14 Nov. Moving up, the immediate resistance is pegged at MYR2,986, the high of 16 February 2017. This is to be followed by MYR3,075, the high of 15 February 2017

Source: RHB Securities Research - 11 Dec 2019