Maintain short positions. The WTI Crude failed to maintain its earlier session’s gains, where it reached a high of USD36.60 before sliding to settle USD0.38 lower at USD35.79. Looking at the latest two sessions’ price actions, we are not spotting any clear signs of a trend reversal taking place, ie the correction phase that started from August remains incomplete. Furthermore, prices are now firmly below both the 50- and 200-day SMA lines. Do note that the RSI reading has still not yet flashed out oversold readings. Hence, we are keeping to our negative trading bias.

We recommend traders stay in short positions. We initiated these at USD39.85, or the closing level of 23 Oct. To manage risks, a stop-loss can be placed at above USD38.28.

Support levels are maintained at USD35.50 and USD34.92 – both derived from 29 Oct’s candle. Moving up, the immediate resistance is set at USD37.20 – near the 200-day SMA line – and followed by USD38.28, or the low of 26 Oct

Source: RHB Securities Research - 2 Nov 2020