SINGAPORE: Palm oil may retest a resistance at 3,451 ringgit per tonne, as it has stabilised around a support of 3,363 ringgit again. The two stabilisations on May 17 and Tuesday are interpreted as an early signal of a double-bottom, which is still developing and will be confirmed when the contract breaks 3,451 ringgit.
Even if this pattern turns out to be a flat, the market is still likely to rise to 3,498 ringgit.
Immediate support is at 3,389 ringgit, a break below which could open the way towards a wide range of 3,288-3,363 ringgit.
On the daily chart, the consolidation in the narrow range of 3,368-3,454 ringgit goes on.
Palm oil ends at over three-week low on slow demand
It is strategically prudent to wait for a break at either 3,368 ringgit or 3,454 ringgit, before targeting 3,288 ringgit or 3,556 ringgit.
In view that a decent bounce has been missing from the May 9 high of 3,837 ringgit, the bias looks more towards the upside.
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