Palm oil may fall towards 5,484 ringgit

SINGAPORE: Palm oil may fall towards 5,484 ringgit, as it failed to break a resistance at 5,676 ringgit per tonne.

The failure triggered a correction against the uptrend from 5,202 ringgit. A narrow rising channel suggests a further drop towards 5,484 ringgit, around which the uptrend may resume.

A break above 5,676 ringgit could lead to a gain to 5,749 ringgit. On the daily chart, palm oil failed to break a resistance at 5,641 ringgit.

This resistance is strengthened by another one established by a rising trendline. Former resistances provided by the trendline proved to be effective in triggering deep drops.

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Even though it is not very clear if a deep drop is developing, it is possible that the contract may fall to 5,473 ringgit first, which is close to 5,484 ringgit (hourly chart).

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