Maintain short positions, while moving down the trailing-stop. The FCPO continue to undergo a retracement, as the commodity’s price tumbled by MYR104.00 to close at MYR2,757 – breaching the previous support levels of MYR2,800 and MYR2,788 as well as the uptrend line that extended from the low in May. As it is moving closer towards the 50-day SMA line, the FCPO’s intraday price movements have yet to indicate any counter-trend rebound is likely to develop. At this juncture, if it breaches above the MYR2,825 level, this would likely mean that the commodity has reached an interim low – which means a stronger rebound could set in. Until this happens, 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 at above MYR2,825

The immediate support is revised to MYR2,735 – near the 50-day SMA line, followed by MYR2,700. Meanwhile, the immediate resistance is now eyed at MYR2,800, followed by MYR2,825.

Source: RHB Securities Research - 25 Sept 2020