Bulls remain in control; maintain long positions. The WTI Crude continued to show resilience as it again attempted to cross the 200-day SMA line in the latest session. The session witnessed the black gold reach a high of USD42.33, before ending USD0.72 higher at USD41.94. The session was the bulls’ second attempt to cross the said SMA line after the failed effort on 5 Aug. Price actions around this SMA line are crucial in signalling the commodity’s next price directional bias, ie a breakout would be a positive price signal while a rejection could see a retracement develop. For now, we are keeping our positive trading bias.

We advise traders to stay in long positions, which we initiated at USD41.96 – the closing level of 21 Jul. To manage risks, a stop-loss can now be placed below the USD41 mark.

The immediate support is revised to USD41, which is near 7 Aug’s low, followed by the USD40 round figure. Moving up, the immediate resistance is pegged at USD42.40, or the high of 21 Jul. This is followed by USD43.52, which is derived from the latest high.

Source: RHB Securities Research - 11 Aug 2020