Maintain long positions. The FCPO’s recent rebound followed through yesterday as it rose MYR47.00 to settle at MYR5,329. The commodity opened slightly lower during the night session at MYR5,273 and oscillated sideways to touch the day’s bottom at MYR5,250. The momentum changed during the morning session, which saw the FCPO jump higher to touch the session high of MYR5,352 during the late session before retracing mildly at the close. The latest bullish candlestick – which following Monday’s rebound above the MYR5,200 strong support – suggests the positive rebound is getting firmer and heading towards the immediate resistance of MYR5,370. This is echoed with the positive RSI pointing higher towards the 70% level. Breaching the immediate resistance may lead the FCPO to print a new high level at MYR5,600. As such, we hold on to our positive trading bias until the trailing-stop mark is breached.

Traders are advised to retain the long positions initiated at MYR4,649, ie the close of 24 Dec 2021. To protect the downside risks, the trailing-stop threshold is set at MYR5,106.

The immediate support remains at MYR5,200, then MYR5,106 or 19 Jan’s low. On the upside, the immediate resistance is seen at MYR5,370, which is followed by the MYR5,600 level.

Source: RHB Securities Research - 27 Jan 2022