Maintain long positions. The WTI Crude extended its minor sideways consolidation phase for the second consecutive session, shedding USD0.19 to settle at USD45.34, after rebounding from an intraday low of USD44.42. We observe that the commodity has rebounded relatively strongly from its intraday lows, over the last two sessions, around the immediate support level of USD44.50. This indicates that the bulls are still present, and the said consolidation phase is still confined to a relatively narrow range – instead of a sharp retracement. This consolidation phase is considered healthy, given the commodity’s prior sharp gains, which saw it breaking away from a multimonth trading range. We maintain our positive trading bias.

We recommend traders stay in long positions. We initiated these at USD44.91 – the closing level of 24 Nov. To manage risks, a stop-loss can be now be placed at the breakeven mark.

Immediate support is maintained at USD44.50, followed by USD43.50. Conversely, the immediate resistance is set at USD47.57, or the high of 5 Mar. This is followed by USD48.66, which was the high of 3 Mar.

Source: RHB Securities Research - 1 Dec 2020