Maintain long positions. The FCPO’s short-term consolidation phase ended amid the emergence of a “Bullish Marubozu” candlestick yesterday, surging MYR201 higher to reclaim the MYR4,000 territory. It opened slightly higher at MYR3,969, and merely touched the day’s low at MYR3,940 before gradually moving upwards tap the day’s high at MYR4,107 and closing stronger at MYR4,092. The strong buying interest above the 50-day SMA line (MYR3,938) has led the commodity to climb nearer towards the MYR4,095 immediate resistance level. We observe that the RSI has breached above the 50% threshold, with the bullish momentum gathering pace again. If this momentum accelerates, it may scale higher to test next hurdle at MYR4,200. Since the commodity is shifting back to a bullish momentum, we maintain our positive bias.

We suggest traders to remain in long positions. We initiated these at MYR4,024, the closing level of 25 May. To manage risks, the stop-loss is set below the MYR3,867 level, or 24 May’s low.

The support levels are still at MYR3,867 (24 May’s low), and MYR3,650 – 16 Apr’s low. Towards the upside, the resistance levels remain at MYR4,095 which was 3 May’s high, followed by MYR4,200.

Source: RHB Securities Research - 3 Jun 2021