Palm oil may retreat into 4,008-4,048 ringgit range before rising
- The uptrend will remain intact.
SINGAPORE: Palm oil may retreat into a range of 4,008 ringgit to 4,048 ringgit per tonne before resuming its uptrend.
The retracement is due to a switch of the expired May contract to the June contract, which closed at 3,988 ringgit on March 12.
The direct effect of this backwardation is a sudden correction on the continuous chart, which is interpreted as a part of the zigzagging rally within a rising channel.
The uptrend will remain intact.
A common gap is expected to form on Monday, which would be totally covered.
On the daily chart, the contract happened to become weak around a resistance at 4,131 ringgit, as confirmed by the doji on March 12.
This weakness is technically responsible for a fall towards 4,026 ringgit.
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