RHB Research has maintained its negative trading bias on crude palm oil futures (FCPO), recommending traders keep their existing short positions despite a temporary moderation in downward momentum.
The FCPO contract posted an indecisive session yesterday, easing RM1 to settle at RM4,573 per tonne after opening at RM4,533.
During the session, the commodity traded between an intraday high of RM4,611 and a low of RM4,532 before closing higher and forming a bullish candlestick pattern.
RHB said the candlestick formation suggests a short-term pause in the recent decline, reflecting a period of market consolidation as prices digest previous losses.
However, the research house noted that the broader technical structure remains bearish, with weak bullish momentum and the Relative Strength Index (RSI) hovering near the 50% level, indicating continued downward pressure.
RHB said FCPO prices could retest the RM4,390 support level if bearish momentum strengthens.
The research house recommended traders maintain short positions initiated at the closing price of 12 May at RM4,481.
The stop-loss level remains unchanged at RM4,700 to manage trading risks.
The first support level is identified at RM4,390, followed by RM4,300.
On the upside, immediate resistance is seen at RM4,600, with stronger resistance at RM4,700.
RHB said the market remains in a sideways consolidation phase in the near term, but the prevailing trend structure continues to favour the downside.
