Maintain long positions. After taking a mild breather on Monday, the E-Mini Dow resumed its uptrend yesterday by climbing 190 pts to settle at 35,323 pts. The index opened at 35,121 pts and then touched its intraday low at 35,067 pts before propelling northwards towards the end of the session. It hit the intraday high of 35,365 pts before the close. The bullish momentum – following on from Monday’s mild profit-taking – has firmed up the buying pressure above the 50-day average line. This renewed positive momentum may drive the E-mini Dow towards the immediate resistance at 35,504 pts in the coming sessions. Due to this, we believe the bulls will be in control. Hence, we stick to our positive trading bias.

We suggest traders keep to the long positions initiated at the closing level of 7 Oct, or 34,638 pts. To manage the trading risks, the initial trailing-stop threshold is set at 34,906 pts.

The immediate support level is marked at 34,906 pts, or 18 Oct’s low. This is followed by the 34,500-pt round number. On the upside, the immediate resistance is eyed at 35,504 pts, ie the high of 3 Sep. This is followed by 36,000 pts.

Source: RHB Securities Research - 20 Oct 2021