Maintain long positions. The E-Mini Dow tested the 29,300-pt immediate support in the latest session, before rebounding to hand in a 52-pt gain to close at 29,443 pts. This latest performance is part of the index’s ongoing multi-session correction that started early this week after it tested the 30,000-pt resistance level for the second time in a span of a week. The said retracement is relatively not aggressive – an indication that the retracement is corrective in nature. However, should the abovementioned immediate support be breached at the closing, a deeper correction phase may set in. Until this happens, we are sticking with our positive trading bias.

We recommend traders stay in long positions. We initiated these at 29,865 pts, or the closing level of 16 Nov. For risk-management purposes, a stop-loss can be placed below 29,300 pts.

Support levels are maintained at 29,300 pts and 28,781 pts – the low of 10 Nov. Conversely, the resistance is expected to emerge at 29,600 pts, followed by the 30,000-pt record high.

Source: RHB Securities Research - 20 Nov 2020