Maintain long positons. The WTI Crude’s latest session’s price performance suggests a likely minor pause is developing. The black gold started the session on a weak tone, sliding to a USD51.50 low before rebounding to settle USD0.01 better at USD52.25. It is likely to trade in a sideways fashion during the coming sessions, as it looks to digest the previous week’s gains. The risk of a deeper correction phase developing will still be confined, as long as prices stay above the USD50.00 psychological level. Hence, we keep to our positive trading bias.

As the trend continues to play out, we recommend traders stay in long positions. We initiated these at USD49.93, or the closing level of 5 Jan. To manage risks, a stop loss can now be placed at the breakeven level.

Support levels are maintained at USD50.81 – the low of 8 Jan – and USD49.50, ie near 6 Jan’s low. Moving up, the immediate resistance is expected at USD54.00 and followed by USD55.00.

Source: RHB Securities Research - 12 Jan 2021