SINGAPORE: Palm oil may test a resistance zone of 3,729-3,740 ringgit per tonne, a break above which could lead to a gain to 3,797 ringgit.
The contract failed twice to break a support of 3,671 ringgit. T
he failures suggest the completion of a wave c from 3,916 ringgit.
A bounce seems to have been triggered, which could be as strong as the preceding wave b.
Even a weaker bounce may extend into 3,740-3,797 ringgit range.
A break below 3,671 ringgit could confirm the continuation of the downtrend towards 3,613 ringgit. On the daily chart, the support at 3,708 ringgit still works effectively.
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The doji forming around this support symbolizes a temporarily dissipation of the bearish momentum.
The contract is likely to stabilize around this level for one or two days, or bounce towards 3,859 ringgit.
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