Momentum still strong; maintain long positions. The FCPO continued to show a strong positive momentum yesterday, settling MYR44 stronger at MYR2,902 – after marginally crossing the previous immediate resistance of MYR2,900. The low and high were recorded at MYR2,863 and MYR2,915. The positive session indicates that the bulls still have firm control over the multi-week uptrend, despite the RSI flashing out an overbought reading. In the absence of a price exhaustion signal, we keep to our positive trading bias.

As the uptrend continues to progress well, and in the absence of a sign that a correction phase is developing, traders are advised to 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.

Immediate support is still at MYR2,685, the low of 2 Dec, followed by MYR2,558, the low of 14 Nov. On the other hand, the immediate resistance is now pegged at MYR2,986, which was the high of 16 February 2017. This is to be followed by MYR3,075, the high of 15 February 2017.

Source: RHB Securities Research - 10 Dec 2019