Maintain long positions. The E-mini Dow reversed from an earlier session’s soft performance to end at the record high of 30,720 pts. Earlier, the index reached a low of 30,154 pts, while the high was posted at 30,912 pts. This came after it recently retested the 30,000-pt psychological level – it continues to signal that the bulls remain in control over the price trend. This positive bias will be enhanced if the RSI manages to cross above the resistance line (as drawn in the chart). Towards the downside, the trend remains intact as long as the 30,000-pt level does not fail. We maintain our positive trading bias.

We recommend traders stay in long positions for now. We initiated these at 30,033 pts, or the closing level of 11 Dec 2020. For risk-management purposes, a stop loss can now be placed below 30,000 pts.

Support levels are revised upwards to 30,500 pts and the 30,000-pt psychological level. Moving up, the immediate resistance is now pegged at 31,000 pts and followed by 31,500 pts.

Source: RHB Securities Research - 7 Jan 2021