Maintain long positions. The E-Mini Dow was not able to extend its previous session’s rebound off the 50-day SMA line. It ended 151 pts softer at 31,358 pts – still within the previous sideways trading range of 31,100-31,500 pts – while the high was posted at 31,587 pts. The intraday price actions suggest the index was trading sideways, an indication that it is digesting its previous session’s gain. Towards the upside, we are still expecting the E-Mini Dow to retest its recent high of around 32,000 pts. Towards the downside, should the 30,800-pt support breach southwards, the risk for the index developing a deeper correction phase will be high. We maintain our positive trading bias for now.

We recommend traders stay in long positons. We initiated these at 31,509 pts, or the closing level of 1 Mar. For risk-management purposes, a stop loss can be placed below 30,800 pts.

Support levels are maintained at 31,200 pts and 30,800 pts, ie near the 50-day SMA line. On the upside, the immediate resistance is pegged at 31,637 pts – 1 Mar’s high – and followed by 32,000 pts.

Source: RHB Securities Research - 3 Mar 2021