Stay long. The E-mini Dow ended higher to form a white candle on Tuesday. It rose 68 pts to close at 28,508 pts, off its high of 28,553 pts and low of 28,341 pts. Based on the current outlook, the index has been able to stay above the previously-indicated 28,242-pt support for more than a week, which implies the buyers are still in control of the market. As the 21-day SMA line is pointing upwards, this leads us to believe the upside swing that started off 10 Dec 2019’s “Hammer” pattern may continue. Overall, we remain bullish on the E-mini Dow’s outlook. As seen in the daily chart, we anticipate the immediate support level at 28,242 pts, ie the low of 19 Dec 2019. The next support is seen at 27,726 pts, which is situated at the low of 10 Dec 2019’s “Hammer” pattern. Towards the upside, the immediate resistance level is now set at the 28,721-pt record high. If a breakout arises, the next resistance is anticipated at the 29,000-pt psychological spot. Hence, we advise traders to stay long, following our recommendation to have long positions above the 28,159-pt level on 17 Dec 2019. A trailing-stop set below the 28,242-pt mark is advisable to limit the downside risk.

Source: RHB Securities Research - 2 Jan 2020