Maintain long positions. The FCPO extended its upward movement yestesday, soaring MYR155.00 to settle at MYR4,738 – a new record closing. On Tuesday, the commodity started on a strong note, gapping up to open at MYR4,595. Riding on strong buying interest, the commodity progressed higher to test MYR4,786 just before closing at MYR4,738. At this stage, the bulls are at their maximum strength and are not showing any signs of fatigue. It is very probable to see a follow-through price action to test the next hurdle at MYR4,800. Meanwhile, we observe the commodity is trading further away from the 50-day SMA line – as such, the bears may decide to take profit. If this happens in the coming session, the immediate support can be found at the MYR4,650 level. Since the peak has not been sighted yet, the FCPO may rise higher on strong momentum. We therefore maintain our bullish trading bias.

Traders should hold on to long positions initiated at the closing level of 22 Sep, or MYR4,330. To mitigate the downside risks, the trailing-stop is raised to MYR4,620.

The immediate support revised to MYR4,650, followed by MYR4,486 ie the low of 4 Oct. Towards the upside, the immediate resistance projected at the new high of MYR4,800, followed by MYR4,900.

Source: RHB Securities Research - 6 Oct 2021