Maintain long positions. The WTI Crude recouped all the intraday losses yesterday to close neutral – it inched USD0.09 higher to USD80.88 and failed to breach the USD80.00 support level. The commodity began with a neutral tone at USD80.66 before dragging gradually towards USD79.30 intraday low in the early US trading session. However, it reversed direction to bounce off from the bottom towards intraday high of USD81.20 and closed just beneath the opening level at USD80.88. The “Hammer” candlestick that formed following the recent downtrend – also just above the USD80.00 support – signals a potential uptrend reversal in the immediate session. If a bullish momentum follows through in the coming sessions, a “higher low” bullish pattern will be formed – this increases the odds of moving higher towards the USD83.08 immediate resistance. Unless the negative momentum reverts to trigger the stop-loss level, we keep to a positive trading bias.

We suggest traders hold on to the long positions initiated at USD84.15, ie the closing level of 9 Nov. To manage downside risks, the intital stop-loss threshold is set at USD80.00.

The support levels remain at USD80.00 and USD78.25, or 4 Nov’s low. Conversely, the nearest resistance level is located at USD83.08 – 3 Nov’s high – and is followed by USD85.41, ie the high of 25 Oct.

Source: RHB Securities Research - 16 Nov 2021