Maintain long positions, with a higher trailing-stop. The FCPO gapped up for two consecutive days to close MYR212.00 higher, in unchartered territory. It opened at MYR4,283 to just tap the low of MYR4,277, before shifting north and extending the momentum to touch the day’s high of MYR4,434, just before closing at MYR4,427. This has strengthened the bullish bias, as the commodity has entered into unchartered territory. The FCPO is set to chart new highs in the medium term. Meanwhile, since the RSI is at the high side of 70%, the immediate-term outlook remains cautious for profit-takers. As such, we set a stricter trailing-stop on the existing positive trading bias.

We suggest that traders remain in long positions. We initiated these at the close of 3 May, or MYR4,061. To manage risks, the trailing-stop is revised higher to MYR4,277 (7 May’s low).

The immediate support level is revised to MYR4,277 (7 May’s low), followed by MYR4,095. Towards the upside, the resistance levels are pegged at the psychological levels of MYR4,500 and MYR4,580.

Source: RHB Securities Research - 10 May 2021