Maintain long positions. While consolidating sideways, the E-Mini Dow managed to bounce off from the immediate support level, adding 48 pts to end higher at 34,864 pts. Initially, the index started at 34,798 pts – it tracked its Asian peers and fell to the 34,593-pt day low. Moving into the US session, strong bullish momentum lifted it to test the 34,878-pt day high before the close. From the latest price action, the E-Mini Dow printed a long lower shadow, reaffirming that the strong support had formed at 34,548 pts. Meanwhile, the index may continue to consolidate, pending momentum to pick up again to retest the 35,000-pt immediate resistance. Premised on the latest “higher low” candlestick pattern, we deem the uptrend as still intact and stick to our positive trading bias.

Traders should maintain the long positions initiated at 34,082 pts, or the closing level of 24 Jun. To reduce the downside risks, a trailing-stop threshold is fixed at 34,150 pts.

The immediate support is marked at 34,548 pts, or the low of 12 Jul, and followed by 34,377 pts – the low of 1 Jul. Meanwhile, the nearest resistance level is pegged at 35,000 pts – 2021’s high – and followed by the higher hurdle projected at 35,200 pts, ie the uncharted new high.

Source: RHB Securities Research - 16 Jul 2021