Maintain short positions. The FCPO extended its sharp decline for the third consecutive session, after failing to extend its minor rebound in the latest session. The soft commodity settled MYR96 lower to close at MYR2,861, crossing below the previous support marks of MYR2,917 and MYR2,890. While the retracement that started from 21 Sep’s “Bearish Engulfing” formation is now approaching the MYR2,800 area – our minimum retracement target – in the absence of a price reversal signal, we keep to 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 at the breakeven mark.

The immediate support is revised to MYR2,800, followed by MYR2,765 – the low of 2 Sep. Towards the upside, the immediate resistance is set at MYR2,890 – the price point of the latest session. This is followed by MYR2,930 – slightly above the latest high.

Source: RHB Securities Research - 24 Sept 2020