Maintain long positions. The FCPO took a breather after a strong rebound on Monday, retracing MYR77.00 to settle at MYR3,249. The commodity had a weak opening, as it gapped down by MYR57.00 at MYR3,269. Mild buying interest let to the FCPO testing the day’s high of MYR3,315, before falling to the day low at MYR3,241. Looking at the price action on Monday and Tuesday, we believe the bulls and bears are evenly matched in strength. The FCPO traded within the upper boundary of MYR3,332 and lower boundary of MYR3,234. A breakout on either side of the boundary will see the formation of a new trend. We will keep an eye on the price action in the next two sessions. Although investor sentiment has turned cautious, we make no change to our positive trading bias.

We recommend that traders stick to long positions. Our long positions were initiated at MYR3,326, or the closing level of 23 Nov. To manage risks, a stop-loss can be placed below the MYR3,234 mark.

The immediate support is marked at MYR3,234, and followed by the recent low of MYR3,182. Towards the upside, the immediate resistance is pegged at MYR3,332, followed by MYR3,370.

Source: RHB Securities Research - 30 Nov 2020