Maintain long positions. The E-Mini Dow was not able to maintain its intraday gains, sliding from a high of 28,457 pts to close 93 pts weaker at 28,204 pts. While the negative intraday price reversal took place about 100 pts below the immediate resistance level of 28,550 pts – located near the multi-week downtrend line – we are not seeing price rejection signals from the said threshold. We continue to emphasise the important of the index’s price actions around the said downtrend line –an upside breach would signal an extension of its upward move, while a price rejection could see the multi-week correction phase, which started from early-September, extending. For now, we are keeping our positive trading bias.

We recommend traders stay in long positions. We initiated these at 27,376 pts – the closing level of 3 Nov. To manage risks, a stop-loss can now be placed below 27,648 pts.

Immediate support is maintained at the 28,000-pt round figure, followed by 27,800 pts – a level currently located near the 50-day SMA line. Meanwhile, the overhead resistance is pegged at 28,550 pts, followed by 12 Oct’s high of 28,846 pts.

Source: RHB Securities Research - 9 Nov 2020