Negative bias invalidated; initiate long positions. The WTI Crude continued to extend its multi-week rebound, after completing a one-week correction phase between 8-15 Jun. It added USD0.71 to close at USD40.46 – marginally above the previous immediate resistance of USD40.44 – marking a new high for the rebound that kicked in following 20 Apr’s historic negative pricing session. The RSI is also turning up again, and is sitting below the overbought threshold. We switch our trading bias to positive.

Our previous short positions, initiated at USD36.34 or the closing level of 11 Jun, were closed out at USD40.44 during the latest trade. With the bulls having regained control over the rebound, we initiate long positions at the latest close. To manage risks, a stop-loss can be placed below the USD38.40 mark.

The immediate support is revised to USD38.40 or the low of 19 Jun, followed by USD37.11, which is the low of 18 Jun. Moving up, immediate resistance is eyed at USD41.06, or 6 Mar’s “Downside Gap”. This is followed by USD43.32 – the low of 2 Mar.

Source: RHB Securities Research - 23 Jun 2020