SINGAPORE: Palm oil is poised to break a support at 4,085 ringgit and fall towards the next support at 3,857 ringgit per tonne.
The contract is consolidating within a rising channel.
Following its failure to rise above a channel, it is expected to fall towards the lower channel line support around 3,857 ringgit.
The bounce triggered by the support at 4,085 ringgit has been mostly reversed.
The reversal signals a continuation of the fall towards 3,857 ringgit.
A break above 4,269 ringgit may lead to a gain to 4,452 ringgit.
On the daily chart, the contract seems to be riding on a wave (5), the final wave of a five-wave cycle from 7,229 ringgit.
This wave is expected to travel below the July 14 low of 3,489 ringgit.
A realistic target is 3,891 ringgit. A break above 4,331 ringgit could signal the continuation of the uptrend towards 4,543 ringgit.
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