Maintain long positions. The FCPO attempted to recoup the losses incurred on Friday last week, and rebounded by MYR78.00 to close at MYR4,583 yesterday. It opened slightly weaker at MYR4,500. After forming the intraday low of MYR4,486, the commodity reversed direction and shifted north to retest the day’s high of MYR4,590. Strong buying interest during the final trading hour kept the commodity near the day’s high, and the FCPO closed stronger at MYR4,583. The latest session showed that the bulls are not giving up yet, are trying to push it towards the resumption of an uptrend. If the MYR4,500 immediate support gives way, the bears will regain momentum and trigger a downward correction towards the 50-day SMA line. As mentioned in our previous note, as long as the RSI is above the 50% threshold, the commodity should still be trend as being on an uptrend. As such, we maintain our bullish trading bias.

Traders should remain in long positions initiated at the closing level of 22 Sep, or MYR4,330. To limit the downside risks, the trailing-stop has been raised to MYR4,486, or the low of 4 Oct.

The immediate support is still at MYR4,500, followed by MYR4,379 or the low of 29 Sep. Towards the upside, the immediate resistance has been maintained at the new high of MYR4,600, followed by MYR4,700.

Source: RHB Securities Research - 5 Oct 2021