Maintain long positions. The FCPO recorded a new high on strong momentum, surging MYR184 to settle stronger at MYR5,628. On Friday, the commodity started off at MYR5,475. After it established the intraday low at MYR5,445 during the afternoon session, the commodity climbed to test the MYR5,639 intraday high before the close. Since the formation of the Breakaway Gap, the commodity has been trending higher on the back of positive momentum. If it sustains above the MYR5,329 level, we think the bullish momentum may follow through and attempt to test the MYR5,700 level. On the other hand, in the event the bears decide to take profits, expect the MYR5,445 level to provide the immediate support. Since the RSI is still pointing upwards, this indicates that the bulls are not yet fatigue. As such, we keep to our positive trading bias.

We advise traders to retain the long positions initiated at MYR4,649, or the close of 24 Dec 2021. To protect the downside risks, the trailing-stop threshold is revised higher to MYR5,300 from MYR5,200.

The immediate support is adjusted higher to MYR5,445 – 28 Jan’s low – followed by MYR5,329, which was the low of 27 Jan. On the upside, the immediate resistance is projected at MYR5,700, followed by MYR5,840.

Source: RHB Securities Research - 31 Jan 2022