Maintain short positions. The FCPO attempted to cross the MYR4,200 level yesterday, but the momentum was not strong enough – it recorded a smaller gain of MYR23.00 to close at MYR4,143. The commodity initially had a flat opening at MYR4,122, but rose to test the MYR4,189 intraday high before falling back to the opening level. Despite the brief positive momentum, the bears remained in control of the session. As mentioned previously, the negative momentum may come to a halt if we can see a bullish reversal pattern or a candlestick with long lower shadow. Before such a bullish technical signal appears, we will hold on to our negative trading bias.

Traders should stick to short positions, initiated at MYR4,308 or the closing level of 28 Jul. To manage risks, the stoploss is revised to MYR4,300.

The nearest support level marked at MYR4,074, the low of 22 Jul, followed by the MYR4,000 psychological level. Towards the upside, the immediate resistance level is revised to MYR4,200, followed by MYR4,366 or the low of 30 Jul.

Source: RHB Securities Research - 4 Aug 2021