- The break below 3,856 ringgit will be considered false, if palm oil manages to close above 3,938 ringgit on Friday.
SINGAPORE: Palm oil may fall into a range of 3,495 ringgit to 3,635 ringgit per tonne, as it has broken a support at 3,888 ringgit per tonne.
The break signals a continuation of the downtrend from 4,525 ringgit, which is extending towards the bottom of a presumed wave B around 3,635 ringgit.
Once the contract drops to 3,635 ringgit, it is highly likely to extend its loss to 3,495 ringgit. A break above 3,888 ringgit, now a resistance, may lead to a gain to 4,010 ringgit.
On the daily chart, there is little doubt that the support at 3,856 ringgit is broken and the contract has moved into the lower channel.
A bearish target of 3,411 ringgit has been established over the next one or two weeks. A realistic target range will be from 3,698-3,774 ringgit.
The break below 3,856 ringgit will be considered false, if palm oil manages to close above 3,938 ringgit on Friday.
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