Maintain short positions. The WTI Crude moved marginally higher, despite trading within a narrow range. It inched USD0.38 higher from Tuesday’s session, to settle at USD48.30. The commodity initially saw a positive opening, at USD48.13. The price was mostly steady during the session until late evening, when it was sold down to the day low of USD47.61. The selling was absorbed by the bulls, and it moved up towards the day high of USD48.66. At the final trading hour, the commodity failed to cross the resistance level, dipping to close at MYR48.30. We reckon that the RSI is attempting a breakout from the downtrend line. If it manages to do this, momentum could pick up, and see the commodity cross the upside resistance. However, we are not changing our view – as long as it trades below the resistance level, we will maintain our negative trading bias.

We recommend traders maintain short positions. Our short positions were initiated at USD47.02, or the closing level of 22 Dec. To manage risks, a stop-loss can be placed above the USD49.28 mark.

The immediate support is marked at USD46.16, followed by USD45.69 – the low of 14 Dec. On the upside, the immediate resistance is pegged at USD48.54. This is followed by USD49.28, or the high of 18 Dec.

Source: RHB Securities Research - 31 Dec 2020