Maintain short positions. The E-Mini Dow moved between 29,589 pts and 29,907 pts, before closing 64 pts higher at 29,868 pts. The latest performance can be seen as part of the index’s multi-week sideways consolidation phase, which is taking place below the 30,000-pt crucial resistance threshold. During the said period, the index made several attempts to close above this threshold. For the index to extend the uptrend, which began from the low in March, we believe it has to close above the crucial threshold. Otherwise, it will remain in the abovementioned consolidation phase, with the near-term risk of retracing towards the lower-end of the consolidation phase, at around 29,000 pts. We maintain our negative trading bias.

We recommend traders stay in short positions. We initiated these at 29,629 pts – the closing level of 30 Nov. For risk-management purposes, a stop-loss can be placed above 30,000 pts.

Support levels are maintained at 29,428 pts – the low of 30 Nov – and the 29,000-pt round figure. On the upside, the immediate resistance is set at the 30,000-pt mark; followed by 30,168 pts, which was the record intraday high.

Source: RHB Securities Research - 3 Dec 2020