Maintain short positions. Yesterday, buyers tried to stage a technical rebound and the FCPO closed MYR19.00 higher, at MYR4,192. After printing a Long-Legged Doji on Monday, the commodity opened at MYR4,133 yesterday. It then set foot at the session’s low of MYR4,125 before climbing to test the high of MYR4,197 before closing. As the closing price is higher than its opening, the bullish candlestick suggests that the bulls are gaining control. In the event positive momentum follows through and breaks past the immediate resistance of MYR4,250, the bullish momentum may pick up pace again. Otherwise, breaching the MYR4,093 immediate support will see sentiment turning negative, and lead to a downside corrective movement. At this juncture, we maintain negative trading bias until a stop-loss is triggered.

We recommend that traders maintain short positions, initiated at MYR4,173 or the closing level of 20 Sep. To mitigate trading risks, the stop-loss is revised to MYR4,250.

The nearest support remains at MYR4,093 – the low of 2 Aug – followed by MYR4,032 or the low of 20 Sep. Towards the upside, the immediate resistance is pegged at MYR4,250 – the high of 20 Sep – followed by MYR4,329 or the high of 17 Sep.

Source: RHB Securities Research - 22 Sept 2021