Maintain short positions. Yesterday, the FCPO marked it fourth consecutive positive close. It hit a high of MYR2,808, before settling MYR37.00 higher at MYR2,768. The latest positive performance defied our expectation of the commodity extending its retracement phase. However, until the MYR2,790 is breached at the close, we maintain our negative trading bias. This is based on the view that the commodity’s upward move that started from the low in May is due for a correction phase.

We advise traders to stay in short positions. We initiated these at MYR2,672, the closing level of 27 Jul. To manage risks, a stop-loss can now be set above MYR2,790.

We revised the immediate support to MYR2,750, the price point of 3 Aug. This is followed by MYR2,700. Towards the upside, the immediate resistance is at MYR2,790, derived from 24 Jul’s high. This is followed by MYR2,808, the latest high.

Source: RHB Securities Research - 11 Aug 2020