Maintain long positions. The FCPO settled above the previous immediate resistance of MYR2,900, at MYR2,911 – indicating a gain of MYR23.00 last Friday. The commodity has rebounded sharply over the past week on failed attempts to break below the MYR2,700 level. In the process, it has recouped more than 50% of the retracement that took place between the high of MYR3,104 posted on 21 Sep, and the low of MYR2,691 posted on 2 and 5 Oct. At this juncture, based on the daily chart, we have yet to spot any clear sign that could spell the end of the rebound phase. Hence, we are keeping our positive trading bias

We recommend that traders stick to long positions. We initiated these at MYR2,818, the closing level of 6 Oct. To manage risks, a stop-loss can be placed at the breakeven mark.

The immediate support is revised to MYR2,900, followed by MYR2,850. On the upside, the immediate resistance is set at MYR2,925, followed by MYR2,950 – the latest high.

Source: RHB Securities Research - 12 Oct 2020