Maintain long positons. The WTI Crude experienced a negative intraday price reversal after it came near to the USD54.00-55.00 resistance zone on the back of an overbought RSI reading. After hitting a high of USD53.93 earlier in the session, the black gold generally retraced for the rest of this period. It hit a low of USD52.58 before narrowing its losses to USD0.30 to close at USD52.91. As mentioned in our previous note, the commodity’s price actions around the USD55.00 resistance is crucial in defining its next price directional bias. Should there be further negative price actions in the coming sessions, ie a downside breach of the USD50.00 psychological level, this could open the door for a deeper correction phase to kick in. For now, we are keeping to our positive trading bias.

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 be placed at the breakeven level.

Support levels are maintained at USD51.50 and USD50.81, or the low of 8 Jan. On the upside, the immediate resistance is maintained at USD54.00, and followed by the USD55.00 threshold.

Source: RHB Securities Research - 14 Jan 2021