Stop-loss triggered; Initiate long positions. The FCPO shifted to a strong bullish momentum after it gapped up yesterday to close MYR193 stronger at MYR4,061. The commodity opened at MYR4,006, boosting upwards to touch the high of MYR4,095 before retracing slightly to close at MYR4,061. This suggests that the bulls have overpowered the bears while resuming the upward movement. If the bullish momentum follows through in the coming sessions, the commodity may retest the recent high of MYR4,095. Breaching the recent high may see the commodity negate the Bearish Engulfing pattern and further challenge the 2021 high, pegged at MYR4,192. Meanwhile, MYR4,000 becomes the psychological level to pivot the commodity higher. Since the FCPO closed above the stop-loss set earlier, we change to a positive trading bias.

We closed out the long positions initiated at the close of 23 Apr, which was MYR3,927, after triggering the stop-loss above MYR3,927 level. Conversely, we initiate long positions at the close of 3 May – MYR4,061. To manage risks, we set the initial stop-loss below MYR3,843.

The support levels revised to MYR4,000, followed by MYR3,843. Towards the upside, the resistance levels are fixed at MYR4,095 and the 15 Mar’s high of MYR4,192.

Source: RHB Securities Research - 4 May 2021