Maintain short positions. The FCPO continued to extend its retracement following the prior session’s “Bearish Engulfing” formation, ending MYR50 weaker at MYR2,957 while the low was recorded at MYR2,917. Based on the latest intraday price actions, we believe there is a good chance of the commodity developing a minor rebound in the coming session. However, looking at the bigger picture, ie the daily chart, we believe once this rebound is completed, the commodity is still likely to see further price retracement. Hence, we are keeping our negative trading bias.

We recommend traders to stay in short positions. We initiated these at MYR3,007, the closing level of 21 Sep. To manage risks, a stop-loss can be placed above MYR3,100.

The immediate support is revised to MYR2,917, the latest low. This is followed by MYR2,890, near 15 Sep’s low. Towards the upside, the immediate resistance is set at MYR3,000, followed by MYR3,040 – the price point of 21 Sep.

Source: RHB Securities Research - 23 Sept 2020