Maintain long positions. After the sharp rebound recorded in the previous two sessions, the FCPO was exhibiting signs of slowing down yesterday. It gained MYR18.00 to close at MYR2,888, briefly testing the MYR2,900 resistance with a high of MYR2,908. While the advancement has decreased in pace, and the commodity was not able to settle above the said resistance, we are not seeing price reversal signals yet. This implies the case for the commodity to extend its rebound from the recent failed breakdown from the MYR2,700 support level is still valid. Premised on this, we are keeping our positive trading bias.

We recommend that traders stay in long positions. We initiated these at MYR2,818, the closing level of 6 Oct. To manage risks, a stop-loss can now be set below MYR2,770.

The immediate support is revised to MYR2,850, followed by MYR2,800. On the upside, the immediate resistance is set at MYR2,900, followed by MYR2,925.

Source: RHB Securities Research - 9 Oct 2020