Keep long positions. The E-Mini Dow continued its uptrend with a stronger bullish momentum and a new high yesterday, climbing 138 pts to settle at 35,938 pts, while eyeing to hit the 36,000-pt immediate resistance. It started on a neutral tone at 35,797 pts to hit 35,695 pts before swiftly moving north to touch the day’s high of 35,971 pts before retracing mildly towards the close. The long white candlestick with a long lower shadow above the immediate support level suggests the strong buying interest is expected to propel the index higher to hit the 36,000-pt immediate resistance, and subsequently print higher in the uncharted territory. Besides forming a “higher high” bullish pattern, the RSI strength is also pointing higher, indicating the bullish momentum will follow through in the coming sessions. As such, we maintain our positive trading bias, which we shifted to in our previous note.

Traders are advised to hold on the long positions initiated at 35,800 pts, or at the closing level of 1 Nov. To manage trading risks, the initial stop-loss threshold is set at 35,383 pts.

The immediate support is pegged at 35,777 pts, followed by 35,383 pts – 27 Oct’s low. On the upside, the immediate resistance is located at 36,000 pts before possibly reaching the 36,500-pt level.

Source: RHB Securities Research - 3 Nov 2021