Maintain long positions. The FCPO inched higher last Thursday, and added MYR12.00 to settle at MYR3,600. The commodity had a positive opening, gapping MYR20.00 upwards to open at MYR3,608. Once the session started, the commodity oscillated between the day’s low of MYR3,568 and day’s high of MYR3,619. During the late trading hours, the bulls marked up to close at the pyschological level of MYR3,600. Although there was some selling pressure during the intraday, the short-term or impulse trend pointed to a positive momentum – as the RSI trended upwards. The medium- and long-term indicators – the 50-day and 200-day SMA lines – were both pointing higher, indicating solid underlying bullish support. As we examine the higher highs and higher lows charted recently, we think the commodity will likely test the upside resistance of MYR3,650 soon. As such, we maintain a positive trading bias.

We recommend that traders maintain long positions. Our long positions were initiated at MYR3,535, the closing level of 23 Dec. To manage risks, a stop-loss can be set below the MYR3,470 mark.

The immediate support level is marked at MYR3,500, followed by MYR3,450. Meanwhile, the immediate resistance is now pegged at MYR3,600, followed by MYR3,650.

Source: RHB Securities Research - 4 Jan 2021