Maintain long positions. Despite the latest black body candlestick printed on the chart showing mild profit-taking, the FCPO progressed higher – it added MYR14.00 to close stronger at MYR4,151. During Monday’s session, it initially gapped up to open at MYR4,186 before touching the day’s high of MYR4,193. The commodity then retraced to touch its day low at MYR4,134 before closing at MYR4,151 – still above Friday’s close. If the profit-taking activities extend, we expect the FCPO to find strong support at the MYR4,065 level, followed by the MYR4,000 psychological level. As the RSI is still pointing upwards, we believe the bullish momentum may resume again in the immediate term. As long as the stop-loss level remains intact, we stick with our positive trading bias.

We recommend traders stay in long positions, which were initiated at the close of 13 Jul, or MYR3,977. To manage risks, the stop-loss threshold is set at the MYR4,000 psychological level.

The support levels are marked at MYR4,065 – the high of 8 Jun – and MYR4,000, ie the psychological level. The immediate resistance level is set at MYR4,260 – 3 Jun’s high – and, subsequently, at MYR4,525, or 12 May’s high.

Source: RHB Securities Research - 21 Jul 2021