Maintain long positions. Despite the strong positive momentum displayed at one point during yesterday’s session, the E-Mini Dow pared most of the gains and recorded a smaller gain of 24 pts to settle at 34,461 pts. The index initially opened flat at 34,473 pts. After touching the day low of 34,389 pts, it bounced to the 34,733-pt day high to see profit taking drag it down during the late US of trading hours – it closed at 34,461 pts. Although it still remains above the support level, selling pressure still persists near the 34,825-pt resistance level. In the event the E-Mini Dow breaks below the support threshold, sentiment may turn bearish. Conversely, crossing above the resistance will see bullish momentum accelerating. While it is consolidating sideways, pending a breakout on either side of the immediate boundary, we are keeping to our positive trading bias.

Traders should maintain the long positions initiated at 34,352 pts, or the closing level of 24 May. For risk management purposes, the stop-loss threshold is placed at the low of 3 Jun, ie 34,310 pts.

The immediate support remains at 34,310 pts, or the low of 3 Jun, and followed by 34,170 pts – the low of 27 May. Meanwhile, the immediate resistance is set at 34,825 pts, ie 7 Jun’s high, and followed by 35,000 pts, which was 2021’s high.

Source: RHB Securities Research - 11 Jun 2021