Maintain short positions as sliding mode not showing signs of ending. The FCPO shed MYR29.00 to close at MYR1,946 – this was after it attempted to cross above the MYR2,000 mark with a high of MYR2,005. The previous immediate support of MYR1,950 was also marginally breached. While the retracement which resumed after the 200-day SMA line was breached in March is nearing the oversold RSI reading and closing in towards the important support of MYR1,918, there was no price trend exhaustion signal spotted. Towards the upside, an upside breach of the MYR2,025 level could potentially mark an end to the retracement phase. Pending this, we are keeping our negative trading bias.

As the downtrend is still developing, we recommend that investors stick to short positions. We initiated these at MYR2,246, the close of 13 Apr. To manage risks, a stop-loss can now be placed above MYRY2,025.

The immediate support is revised to MYR1,918, the low of 10 Jul 2019. This is followed by MYR1,863, the low of 25 Aug 2015. Moving up, resistance points are pegged at MYR1,975, the price point of the latest session. This is followed by MYR2,025 – derived from 4 May’s candle.

Source: RHB Securities Research - 8 May 2020