Maintain short positions as the bulls are still capped by the 200-day SMA line. The FCPO tried to retest the 200- day SMA line with an intraday high of MYR2,380. However, it failed to maintain most of the intraday gains and closed MYR2.00 higher at MYR2,321.00. The positive price reaction also came after the RSI reading flashed out a slight oversold signal in the previous session – on the back of the recent retracement. However, as long as the commodity is still not able to recoup the SMA line, the risk of the FCPO undergoing a further retracement remains high. As such, we maintain our negative trading bias.

Traders are advised to maintain short positions. We initiated these at MYR2,695.00, the closing level of 11 Feb. To manage risks, a stop-loss can be placed above MYR2,480. 

The immediate support is set at MYR2,288, the low of 28 Feb. This is followed by MYR2,247, the low of 18 Oct 2019. On the other hand, the immediate resistance is pegged at MYR2,380.00 , this is followed by MYR2,430.00 – both are derived from 28 Feb’s candle.

Source: RHB Securities Research - 3 Mar 2020