Maintain long positions as the bulls stay in control. The E-mini Dow ended the latest trade 48 pts higher at 27,333 pts, after it managed to rebound from the session’s low of 27,105 pts. The index has been developing a new leg of upward movement over the past week, following its recent retesting of the 50- and 200-day SMA lines. It is currently trading above 26,779 pts, a resistance-turned-support that the bulls had been attempting to cross for weeks. Additionally, the RSI reading is also picking up – a good sign of improving momentum. Maintain our positive trading bias.

We advise traders to stay in long positions. We initiated these at 26,491 pts – the closing level of 14 Jul. For riskmanagement purposes, a stop-loss can now be placed at the breakeven level.

We revise the immediate support to the 27,000-pt round figure, followed by 26,779 pts, which is the high of 16 Jun. Moving up, the immediate resistance is pegged at 27,624 pts, the high of 9 Jun. This is followed by the 28,000-pt round figure.

Source: RHB Securities Research - 10 Aug 2020