Maintain short positions. The E-Mini Dow posted another weak sentiment yesterday, falling sharply to settle 459 pts lower at 33,066 pts – just above the 33,031-pt immediate support. After opening slightly positive at 33,585 pts, the index oscillated sideways and attempted to test the session high at 33,824 pts. However, the intraday gains were erased and selling pressure dragged it towards the 33,015-pt session low before the close. The latest long black bearish candlestick – which is near to its day’s low – signals the acceleration of selling pressure that could potentially persist in breaching the immediate support in the coming sessions. This is supported by the weakening of the RSI below 30% level. As the E-Mini Dow’s bearish momentum is getting more obvious, we stick to our negative trading bias.

We advice traders to hold on to short positions initiated at the closing level of 11 Feb, ie 34,627 pts. For risk-management purposes, the initial trailing-stop threshold is introduced at 34,500 pts.

The support levels are revised to 33,031 pts – 24 Jan’s low – and 32,500 pts. The immediate resistance is lowered to 33,824 pts or the high of 23 Feb. This is followed by the 34,500-ptsmark.

Source: RHB Securities Research - 24 Feb 2022