The upside move is likely to continue; stay long. The E-mini Dow’s upside strength continued as expected, after it ended higher and formed a white candle last night. The index rose 521 pts to close at 24,566 pts – this was off the session’s low of 23,971 pts. Market sentiment remains positive, as the E-mini Dow has taken out the previously indicated 24,435-pt resistance and hit its highest point in more than a month. Furthermore, the 14-day RSI indicator recovered to a more positive reading at 58.83 pts, enhancing the positive sentiment.

Presently, the immediate support level is seen at 23,535 pts, which was the low of 27 Apr. Meanwhile, the next support is maintained at 22,814 pts, or the low of the low of 22 Apr’s “Bullish Harami” pattern. To the upside, we anticipate the immediate resistance level at the 25,000-pt psychological spot. If a decisive breakout arises, look to 26,282 pts – obtained from the high of 6 Mar – as the next resistance.

To recap, we initially recommended traders to initiate long positions above the 20,280-pt level on 26 Mar. We continue to advise them to stay long for now while setting a trailing-stop below the 23,535-pt threshold. This is in order to lock in a larger part of the gains.

Source: RHB Securities Research - 30 Apr 2020