Maintain long positions. Despite mild selling pressure during the Asian trading hours, the E-Mini Dow saw the bullish momentum extend yesterday, advancing 83 pts to settle at 35,034 pts – a fresh all-time record high. On Monday, after opening at 34,944 pts, the index tracked the weaknesses of its Asian peers, retracing to the 34,652- pt session low. The momentum reversed during the European trading hours, turning higher to test the 35,072-pt intraday high before the close. With the RSI pointing upwards, we expect the bullish momentum to follow through in the coming sessions, lifting the E-Mini Dow higher into uncharted territory. In the event the bears take profit, we expect the 34,652-pt level to act as strong support. Since the bulls remain in the driver’s seat, we are keeping with our positive trading bias.

Traders are recommended to stick with the long position initiated at 34,709 pts, or the closing level of 22 Jul. To mitigate trading risks, the stop-loss threshold is revised to 34,557 pts, ie the low of 22 Jul.

The immediate support is revised to 34,652 pts – the low of 26 Jul – and followed by 34,361 pts, or the low of 21 Jul. Meanwhile, the immediate resistance level is eyed at 35,200 pts and followed by 35,350 pts – both located in uncharted territory.

Source: RHB Securities Research - 27 Jul 2021