SINGAPORE: Palm oil may stabilise around a support at 3,208 ringgit per tonne and bounce towards 3,322 ringgit.

The support is identified as the 7% retracement of the downtrend from 3,846 ringgit to 3,160 ringgit. It is strengthened by another one at 3,196 ringgit, the Jan. 26 low and the bottom of a wave b.

The gap forming between Feb. 2 and Feb. 3 may be covered, as it looks like a common gap. A drop below 3,160 ringgit could signal the extension of the downtrend towards 2,973 ringgit.

On the daily chart, the contract may consolidate further around a rising trendline.

The bounce triggered by the support at 3,148 ringgit may consist of three waves. So far, only the first wave is over.

The current wave b may end above 3,148 ringgit, to be reversed by the wave c.

Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.