SINGAPORE: Palm oil may retest a support of 3,686 ringgit per tonne, a break below which could be followed by a further drop into 3,542-3,608 ringgit.
The drop is well-controlled by a set of retracements on the fall from 4,350 ringgit.
It is riding on a wave e, the fifth wave of a five-wave cycle from the Aug. 12 high of 4,495 ringgit.
This wave is expected to unfold within a falling channel, which suggests a target far below 3,481 ringgit.
Palm extends losses on weaker rival oils, higher stocks
Resistance is at 3,813 ringgit, a break above which may lead to a gain to 3,916 ringgit.
On the daily chart, the bounce from the Sept. 8 low of 3,481 ringgit could be the final struggle of bulls to maintain the price above the July 14 low of 3,489 ringgit.
A projection analysis reveals a target zone of 2,540-2,963 ringgit, which will be available when the contract falls below 3,489 ringgit.
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