Maintain short positions as the trend remains bearish. The FCPO closed MYR23 lower, at MYR2,216, yesterday – after it tested the immediate support of MYR2,186. Despite it managed to rebound from the support level, it was still insufficient to signal that the negative trend is ready for a reversal. The negative session set in after the commodity underwent a sharp negative intraday price reversal from an area near the 200-day SMA line in the previous session. Hence, we are keeping our negative trading bias.

With no change in trend observed, traders are advised to remain in short positions. These were initiated at MYR2,332, the close of 9 Mar. To manage risks, a stop-loss can be placed above the MYR2,350 threshold.

The immediate support is maintained at MYR2,186, the low of 17 Mar, this is followed by MYR2,150. Moving up, the immediate resistance is revised to MYR2,271, the latest high, this is followed by MYR2,350 – the price point of 18 Mar.

Source: RHB Securities Research - 20 Mar 2020