Maintain long positions. The E-Mini Dow edged higher again yesterday, rising 99 pts to close at 36,381 pts – closing at an all-time high. The index opened at 36,278 pts and then touched the 36,250-pt low before propelling higher towards the day’s peak at 36,463 pts. It then retraced moderately to close at 36,381 pts. The white body candlestick – retraced from the 36,446-pt immediate resistance - signifies that the E-Mini Dow is poised to continue the rally in the medium term. Nevertheless, we expect mild profit-taking to take place in the coming sessions – below the 36,446-pt resistance – before propelling towards uncharted territory. This is also supported by a positive-territory RSI that is slightly above the 60% level, which is still far from the overbought point. As such, we keep to our positive trading bias.

We suggest traders stick to the long positions initiated at 36,178 pts, ie the closing level of 27 Dec. For risk-management purposes, the initial stop-loss threshold is revised higher to 35,900 pts.

The immediate support is set at 35,900 pts – 26 Nov’s high – and followed by 35,383 pts, or 27 Nov’s low. The immediate resistance levels are pegged at 36,446 pts – 8 Nov’s high – and 37,000 pts.

Source: RHB Securities Research - 30 Dec 2021