No confirmation for a reversal; maintain long positions. The FCPO tested the immediate support of MYR2,300 with a low of MYR2,298 – before rebounding to post a gain of MYR22 to close at MYR2,348. The said positive intraday price reversal means there was no confirmation to the prior session’s adverse price signal, and is indicative that the bulls are in presence. By extension, there is still a lack of price evidence to suggest the commodity’s 4-week rebound is due for a deeper correction phase. Hence, we are keeping our positive trading bias.

In the absence of a price reversal confirmation, we advise traders to stay in long positions. We initiated these at MYR2,032, the closing level of 13 May. To manage risks, a stop-loss can be placed below MYR2,300.

The immediate support is maintained at MYR2,300. This is followed by MYR2,270 – the low of 2 Jun. Meanwhile, the immediate resistance is now set at MYR2,387 – the high of 4 May. This is followed by MYR2,409 – the high of 9 Apr’s “Bearish Engulfing” pattern.

Source: RHB Securities Research - 9 Jun 2020