Maintain long positions. The FCPO bounced off the 50-day SMA line amid bullish momentum, rising MYR53.00 to settle at MYR4,447. Following strong profit taking activities on Monday, the commodity started Tuesday’s session weaker at MYR4,360. It then fell to the session’s low of MYR4,318 before reversing strongly in the afternoon session, surging to test the session’s high of MYR4,477. It closed near to the intraday high and printed a long white candlestick – recouping the losses incurred in the last two sessions. The latest session confirms that the bulls are respecting the downside support of the 50-day SMA line while leaving a “long lower shadow” near the MYR4,320 level. With the RSI pointing upwards, we expect the positive price action to follow through in the immediate session. As the FCPO is on the verge of resuming its upward movement, we retain our bullish trading bias.

We advise traders maintain long positions initiated at the closing level of 22 Sep, or MYR4,330. To manage trading risks, the stop-loss is kept at MYR4,290.

The immediate support is marked at MYR4,320 – the low of 23 Sep – followed by the MYR4,200 round figure. On the other hand, the immediate resistance is pegged at MYR4,480, or the high of 8 Sep, followed by the higher hurdle of the MYR4,600 round figure.

Source: RHB Securities Research - 29 Sept 2021