Maintain long positions. The FCPO dropped by MYR7.00 to settle at MYR3,923 yesterday. After the commodity started the session at MYR3,915, it climbed to the day’s high of MYR3,966. It then see-sawed to the day’s low of MYR3,862 amid profit-taking activities, before rebounding. This price action as a healthy pullback for a consolidation after the FCPO staged a strong rally in previous sessons. As long as it remains above MYR3,850 pts, the bearish pressure would be contained. We will maintain a positive trading bias until the stop-loss is triggered.

We recommend that traders switch to long positions, initiated at MYR3,930 or the closing level of 23 Mar. To manage risks, the stop-loss is placed at MYR3,835.

The downside support is unchanged at MYR3,850, followed by MYR3,800. Towards the upside, the immediate resistance level is at the MYR4,000 psychological level, then at the round number of MYR4,040.

Source: RHB Securities Research - 25 Mar 2021