SINGAPORE: Palm oil may bounce into a range of 5,086 ringgit to 5,204 ringgit, as it has found a support at 4,896 ringgit per tonne.
The contract is riding on a wave C from 6,698 ringgit.
This wave could travel to its 100% projection level of 4,588 ringgit.
The 138.2% level of 4,896 ringgit proved to be a strong support, which temporarily stopped the wave C.
There is no clear indication of how strong the bounce would be, which could end around 5,086 ringgit if it is very weak, or 5,204 ringgit if it is strong.
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A break above 5,204 ringgit could lead to a gain into 5,303-5,394 ringgit range, while a break below 4,896 ringgit could open the way towards 4,588 ringgit.
On the daily chart, a wave (c) from 7,229 ringgit is unfolding, which is travelling towards a range of 4,331 ringgit to 4,754 ringgit.
The hammer on Monday looks like a convincing reversal pattern after so much drop.
The coming bounce could be driven by a wave 4, which may travel into 5,177-5,313 ringgit range.
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