Maintain long positions. The FCPO oscillated between a low and high of MYR2,979 and MYR3,018, before closing MYR14.00 lower at MYR2,988 yesterday. We regard the latest performance as part of the commodity’s minor sideways consolidation phase that started from the previous session, following the sharp gains earned in the previous week. This ongoing consolidation phase is still narrow in nature, and we are still expecting it to carry on – at least, into the next session. Overall, based on the daily chart, the upward move following the failure to break below the MYR2,700 threshold is still intact. We maintain 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 below MYR2,900.

The immediate support is maintained at MYR2,960, followed by MYR2,900. Meanwhile, the immediate resistance is expected at MYR3,050, followed by MYR3,104 – the high of 21 Sep.

Source: RHB Securities Research - 15 Oct 2020