SINGAPORE: Palm oil may edge up to a resistance at 3,980 ringgit per tonne before turning around an and retesting a support at 3,888 ringgit. The contract is riding on a wave C from 4,276 ringgit, which may either end around 3,796 ringgit or extend to 3,500 ringgit.
The favoured scenario is an extension towards 3,500 ringgit.
The current bounce is classified as a pullback towards a short trendline. The pullback may end around 3,980 ringgit.
A break below 3,888 ringgit may signal the early completion of the bounce.
A target zone of 3,683-3,796 ringgit will be established accordingly.
A break above 3,980 ringgit may lead to a gain to 4,093 ringgit.
On the daily chart, the contract seems to be stabilizing around a support of 3,859 ringgit.
The stabilization is regarded as a part of the pullback towards a trendline rising from 3,220 ringgit.
The downtrend from 4,497 ringgit is expected to resume upon the completion of the pullback.