Stop-loss triggered; initiate long positions. Bullish momentum on the FCPO picked up pace yesterday, and the commodity closed MYR114.00 higher, at MYR3,977. It opened with a gap-up, at MYR3,919. After it printed the intraday low of MYR3,888, it rose to test the day’s high of MYR3,997 before closing. With the latest positive price action, the commodity has formed a foothold above the 50-day SMA line (MYR3,878). As long as it continues to trade above the immediate support level of MYR3,863, the bullish momentum should lift the FCPO to test the MYR4,000-psychologcial resistance level. Since the stop-loss threshold has been breached, we switch to a positive trading bias.

We close out short positions that were initiated at MYR3,795, or the closing level of 7 Jul, after the stop-loss of MYR3,940 was breached. Conversely, we initiate long positions at the close of 13 Jul, or MYR3,977. To manage risks, the initial stop-loss is set at MYR3,775.

The immediate support level has been revised to MYR3,863, the close of 12 Jul, followed by MYR3,775, the low of 9 Jul. The immediate resistance level is set at the MYR4,000 psychological mark, and subsequently at MYR4,065 – the high of 8 Jul.

Source: RHB Securities Research - 14 Jul 2021