SINGAPORE: Palm oil looks neutral in a range of 5,702-5,892 ringgit per tonne, and an escape could suggest a direction.
A break below 5,702 ringgit would confirm the continuation of the wave C towards 5,394-5,571 ringgit range, formed by its 100% and 86.4% projection levels.
However, after the steep fall from the June 10 high of 6,277 ringgit, the contract is expected to experience a bounce, or at least a consolidation in the range of 5,702-5,892 ringgit.
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A break above 5,892 ringgit may lead to a gain to 6,046 ringgit.
On the daily chart, a pullback towards a rising trendline is missing.
After three consecutive days of drop, the pullback is more likely to occur on Tuesday.
The pullback will have little impact on the downtrend which will remain intact and may eventually extend to 5,438 ringgit.
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