PP 7767/09/2010(025354)

Malaysia Technical Research

RHB Research
Institute Sdn Bhd
A member of the
RHB Banking Group
Company No: 233327 -M

W e e kl y T e ch ni ca l V ie w p o int
26 April 2010
MARKET DATELINE

Commodities & Currencies

Potential Technical Rebound On The Commodities This Week…

Chart Performance on Key Commodities:

Light Sweet Crude Oil futures (Crude)

Chart 1: Light Sweet Crude Oil Futures Weekly

♦ Instead of registering another negative candle, the US

Light Sweet Crude Oil futures recorded a positive
candle after touching a low of US$80.53 in early last
week.

♦ The positive candle has saved the commodity from

falling straight towards the US$78 support level.

♦ Although the weekly stochastics renewed its “sell”

signal, last week’s recovery has refreshed hope for a
technical rebound in the near term.

♦ If the buying momentum recovers further, Crude may

retest the recent high of US$87.09 and the key
resistance of US$87 this week.

♦ Crossing US$87 will boost its short-term outlook, and

aim its target at US$100 next.

Crude Palm Oil futures (CPO)

Chart 2: Crude Palm Oil Futures Weekly

♦ On follow-through selling momentum, crude palm oil

futures (CPO) dipped below the crucial RM2,500 support
level early last week.

♦ CPO headed to a low of RM2,455, but later recovered

steadily and closed the week at RM2,540, with a
positive candle, sparing from a straight fall to below the
RM2,500 stronghold.

♦ Not only that, the momentum indicators have ticked a

“double buy” signal to imply stronger push this week.

♦ The bottom line is it must sustain at above RM2,500 to

remain positive, otherwise, it will reinvite the sellers
with more “sell” signals ahead.

♦ Immediate resistance is at the 10-week SMA at

RM2,583, while further support is at the 40-week SMA
of RM2,414.

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Chart Intepretations On Selective Currencies:

Chart 3: RM/US$ Weekly Ringgit (RM)/US$

♦ Surprisingly, the ringgit remained resilient last week,

as the RM/US$ chart failed to confirm the “inverted
hammer” candle registered earlier. Instead, it recorded
another “inverted hammer-like” candle last week.

♦ The pattern suggests yet another chance for the US$

to rebound against the ringgit, after a steep drop
weeks ago.

♦ The stochastic oscillators have stayed in the ‘extremely

oversold” region while the 14-week RSI failed to issue
any rebound last week.

♦ The technicals are simply saying that the previous buy

mode on the ringgit has run out of steam, but the
buying on the greenback has yet to begin strongly.

♦ This leaves the pair in a crossroad, with resistance at

3.29, and a lower support at 3.07.

Chart 4: JPY/US$ Weekly Japanese Yen (JPY)/US$

♦ The JPY/US$ chart turned around with a “bullish

engulfing” candle last week, following two consecutive
bearish candles earlier.

♦ The swift rebound has lead the pair back to above the
60-week SMA near 93.3 and repainted a short-term
positive view on the US greenback.

♦ However, the strength could be muted due to the

mixed momentum readings on the indicators.

♦ Chart wise, the pair should see strong resistance at the

recent high of 94.69 and the 95.5 chart hurdle.

♦ Losing the 95.5 will mean further weakening of the yen

to 101 against the US$ likely in the near term.

♦ Immediate support for the pair is at the 60-week SMA

and the DRL near 90.

Chart 5: EUR/US$ Weekly Euro Dollar (EUR)/US$

♦ Instead of falling towards the 0.73 level, the EUR/US$

pair registered another mild positive candle on the
chart last week, suggesting renewed selling forces on
the EUR in favour to the US$.

♦ With both the short-term momentum indicators ticking

upward again last week, there is a higher chance for
the US$ to strengthen further against the EUR this
week.

♦ If the dollar surpasses last week’s high of 0.757, it will

gear up to challenge the 0.77 level soon.

♦ Through the chart, the support is firmly seen at the

0.73 level, followed by the 21-week SMA near 0.719

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 US Dollar Index (DXY)
Chart 6: US Dollar Index Weekly

♦ After falling back to below the resistance level of 81,

the US Dollar index (DXY) has reversed its retreat and
climbed back to above the resistance last week.

♦ The index has registered another positive candle,

indicating potential follow-through buying this week.

♦ Chart wise, if it manages to sustain at above 81,

buying support would increase, hence leading it to
retest the previous high of 82.52 in the near term.

♦ However, in view of the muted momentum readings,

upside strength should be mildly mitigated by sporadic
selling pressure on the US$.

♦ Beyond the recent high, it will see a stronger hurdle at

85, while further support is seen near the 21-week
SMA of 79.58.

IMPORTANT DISCLOSURES

This report has been prepared by RHB Research Institute Sdn Bhd (RHBRI) and is for private circulation only to clients of RHBRI and RHB Investment Bank Berhad
(previously known as RHB Sakura Merchant Bankers Berhad). It is for distribution only under such circumstances as may be permitted by applicable law. The
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be contrary to opinions expressed by other business units within the RHB Group as a result of using different assumptions and criteria. This report is not to be
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manner whatsoever and no reliance upon such statement by anyone shall give rise to any claim whatsoever against RHBRI. RHBRI and/or its associated persons
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This report does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives
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Technical recommendation framework for stocks and sectors are as follows: -

Technical Recommendation:
Trading Buy = Short-term positive opportunity spotted. It is an aggressive trading recommendation with a book to sellers’ price for short-term technical upside.
Bargain Buy = Short-term positive but technical signals have yet to trigger a rally. Traders can park and queue for their desired entry level within a small range.
Buy on Weakness = Short- to Medium-term positiveness anticipated, but technical readings are still negative. Traders can pick-up the stock for future rally.
Sell on Strength = Short-term momentum still positive, Traders are advice to lock in profit base on current strength.
Take Profit = Short-term target achieved. Traders are advice to exit before the technical readings turn bearish.
Avoid = Risky situation in the short-term and high volatility expected on the share price. Traders’ best strategy is staying away until it stabilises.

Technical Time Frame:

Immediate-term = short time frame within a contra period.
Short-term = moderate time frame within two to three contra periods. For tracking purposes, we refer to 10 trading days.
Medium-term = medium time frame usually refers to two to three weeks period. For tracking purposes, we refer to 20 trading days.

Technical recommendations are generally short-term in nature and may differ from RHBRI’s equity fundamental view and recommendation on the same company.

RHBRI is a participant of the CMDF-Bursa Research Scheme and will receive compensation for the participation. Additional information on recommended
securities, subject to the duties of confidentiality, will be made available upon request.

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actions of third parties in this respect.

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