Maintain short positions while revising trailing-stop higher. The FCPO gained MYR48 to close at MYR2,407– trading ranged between MYR2,381 and MYR2,409. The closing level placed the commodity above the previous immediate resistance of MYR2,390 and slightly above the MYR2,400 round figure. However, we believe the commodity’s correction phase remains incomplete. Towards the downside, we are taking the view that 30 Jun’s low of MYR2,293 is likely to be tested. Hence, we are keeping our negative trading bias.

We advise traders to stay in short positions. We initiated these at MYR2,359 – the closing level of 7 Jul. To manage risk, we revise our stop-loss higher, above MYR2,450 – to account for potential price volatility ahead of data to be released on Friday.

We revise the immediate support to MYR2,380 – near the latest low. This is followed by MYR2,335 – the low of 3 Jul. Conversely, the immediate resistance is now eyed at MYR2,420, which is 6 Jul’s high. This is followed by MYR2,450 – price point of 24 Jun.

Source: RHB Securities Research - 14 Jul 2020