SINGAPORE: Palm oil may break a support of 3,892 ringgit per tonne, and fall into a range of 3,810-3,856 ringgit.
The bounce caused by the support unexpectedly extended a bit on March 17. However, it ended up being completely reversed.
The reversal confirmed a completion of the bounce and a continuation of the downtrend. Once the contract breaks 3,892 ringgit, it will be highly likely to revisit the low of 3,728 ringgit, as the support at 3,892 ringgit works as the final key barrier towards 3,728 ringgit.
A break above 3,931 ringgit may lead to a gain to 3,974 ringgit.
Such a gain will still be classified as an extension of the bounce, which may complete around 4,006 ringgit.
Palm posts second weekly loss on lower rival oils
On the daily chart, the bounce triggered by the support of 3,907 ringgit looks weak, even though this support is strengthened by a similar one established by a rising trendline.
The weakness simply indicates a prevailing bearish sentiment, which supports a further drop towards 3,721 ringgit.
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