Maintain long positions. The FCPO continued its positive momentum and closed MYR95.00 higher, at MYR3,805. Yesterday, it opened weaker at MYR3,690 and dipped to the day’s low of MYR3,680 before switching direction to move north until the end of the session. It touched the day’s high of MYR3,813 just before it closed at MYR3,805. The Bullish Engulfing pattern formed yesterday, which breached the 50-day SMA line, indicates that the bulls are in the driver’s seat. As such, the commodity is expected to trend higher above the moving average line. Hence, we make no change to our positive trading bias.

We recommend traders to remain long positions, which were initiated at MYR3,590 or the close of the Jul 2021 contract on 15 Apr. To manage risks, the trailing stop is placed at MYR3,680.

The immediate support level is marked at 19 Apr’s high of MYR3,726, followed by MYR3,650 – 16 Apr’s low. Towards the upside, the immediate resistance is revised to 7 Apr’s high of MYR3,870 level, while the next resistance is pegged at 8 Apr’s high of MYR3,921.

Source: RHB Securities Research - 21 Apr 2021