Maintain long positions. The E-Mini Dow climbed higher last Friday, adding 76 pts to settle the week at 34,513 pts. Since observing the index establishing 2021’s low 29,552 pts on 1 Feb, it has been moving upwards in a series of “higher highs and higher lows”. This showed the bulls are controlling the uptrend, coupled with the bears growing weaker. For the past three weeks, it also tested the 33,700-pt level at numerous occasions, forming a strong support at 33,700 pts, which also coincides with the 13-week SMA line. As long as the E-Mini Dow trades above the 13- week SMA line, it will maintain an upward trajectory and may re-test the high of 2021: 35,000 pts. Premised on this, we keep to our positive trading bias.

We recommend traders hold on to the long positions initiated at 34,352 pts, or the closing level of 24 May. For risk management purposes, the initial stop loss is placed at 33,700 pts.

The immediate support remains unchanged at 34,170 pts – the low of 27 May – and followed by 33,700 pts. On the upside, the immediate resistance is eyed at 34,550 pts, followed by 34,700 pts.

Source: RHB Securities Research - 1 Jun 2021