Maintain long positions, as the bulls are merely taking a pause. The WTI Crude ended its latest trade on the soft side – ceding USD0.40 to close at USD53.38. The low and high were recorded at USD52.55 and USD53.86. The weak performance likely indicates that the bulls were taking a breather after the recent sessions’ upward moves. Broadly, we believe the black gold is in the process of developing a stronger rebound, if not resuming its upward move, which started from Dec 2018. Hence, we are keeping our positive trading bias.

As we still are seeing the potential for the WTI Crude to scale higher, we recommended traders to stay in long positions. These were initiated at USD53.29, or the closing level of 19 Feb. To manage the risk, a stop-loss can be placed below the USD50.88 mark.

Immediate support is pegged at USD52.30, which was derived from 19 Feb’s candle. This is followed by USD50.88, ie the low of 18 Feb. Conversely, the immediate resistance is set at USD54.37 – a price point from 29 Jan’s candle. This is followed by USD55.60, which was derived from 24 Jan’s candle.

Source: RHB Securities Research - 24 Feb 2020