RHB technical analysis: Gold bearish; WTI crude futures bullish bias; Dow futures trigger sell

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RHB Research Institute’s technical analysis today shows that the outlook for gold is negative, WTI Crude Futures stays “bullish bias stable” and Dow futures contracts have triggered a “short signal”.

The local research house advises its clients to “stay short” on gold as the outlook remains negative, although it rose US$9.40 to close at US$1,203.10, after oscillating between US$1,203.70 and US$1,192.50. “Still, we believe the bears are in control of the market, as the commodity failed to close above the crucial US$1,220.40 resistance mentioned three weeks ago.

"Yesterday’s candle can be viewed as a weak recovery after the recent fall. Overall, we believe the COMEX Gold’s short-term outlook remains bearish.”

On WTI crude tutures, RHB Research Institute advises its customers to “stay long” as no significant bearish action is in sight. “The WTI Crude formed a small black candle last night, after it opened at US$56.41 and closed at US$55.26. It dropped US$1.12, implying that yesterday’s session was under bearish influence.

“However, the overall market is still trading above US$54.24 with no significant bearish activity in sight, which indicates that the bullish bias since April 15 is stable.”

On the Dow Jones Industrial Average futures contracts, it says a “short signal” has been triggered. “Initiate short positions below the 18,035-point level. Last night, the DJIAF left a long black candle and settled at 17,883 points … The long black candle has engulfed the prior candle to form a ‘Bearish Engulfing’ pattern, which implies a technical sell signal.

“In addition, the index erased the previous day’s gains and stayed below 18,000 points for the third consecutive day, implying that sentiment should remain negative in the near term.”