Maintain long positions. The WTI Crude continued to see profit-taking yesterday, closing USD0.56 lower at USD70.73 – partially recouping its losses to close above the 200-day average line. It opened at USD71.12 and moved in a volatile fashion between the USD72.03 high and USD69.51 low – strong selling pressure during the European trading session dragged the commodity from the day’s high to the day’s low. It then recovered part of the intraday losses, bouncing off towards the close. The latest black body candlestick with lower shadow touched the immediate support, implying that downside is limited – and it has found its footing above the support level. Therefore, we expect a positive rebound towards USD72.93 in the coming sessions, supported by the uptrend momentum above the 200-day SMA line, which remains intact. Unless the stop-loss is triggered, we will keep our positive trading bias.

We suggest traders stick to the long positions initiated at USD72.05, or the closing level of 7 Dec. To manage the downside risks, the initial stop-loss threshold is set at USD67.40, below the 200-day average line.

The immediate support is fixed at USD69.49 – 1 Dec’s high – followed by USD67.40, or the low of 26 Nov. The nearest resistance is pegged at USD72.93 – 29 Nov’s high –followed by USD74.76, or 22 Nov’s low.

Source: RHB Securities Research - 15 Dec 2021