SINGAPORE: Palm oil looks neutral in a narrow range of 3,363-3,418 ringgit per tonne and an escape could suggest a direction. The contract has been remaining sideways above a support of 3,363 ringgit for a few days, supposed to form a temporary bottom and rise towards the range of 3,498-3,563 ringgit.
However, it has been slowly retracing towards 3,363 ringgit. The bounce momentum has been dropping and the hope for a strong bounce fading.
One of the possibilities of the underperformance is a continuation of the downtrend from 3,837 ringgit. To confirm the continuation would require the contract to break 3,363 ringgit.
Palm oil ends at over three-week low on slow demand
A break above 3,418 ringgit may lead to a gain into the 3,451-3,498 ringgit range.
Signals on the daily chart are mixed as well, while the contract remains sideways within a narrow range of 3,368-3,454 ringgit.
The longer it consolidates in the range, the more likely it falls towards 3,288 ringgit.
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