SINGAPORE: Palm oil may break a support at 3,351 ringgit per tonne and fall to 3,195 ringgit.

The bounce triggered by the support has been totally reversed. The reversal signals a continuation of a downward wave C towards its ultimate target at 3,195 ringgit.

Strategically, the target will be confirmed when the contract falls below 3,299 ringgit. A break above 3,447 ringgit could confirm an extension of the bounce towards 3,506-3,602 ringgit range.

On the daily chart, the contract closed far below a resistance at 3,537 ringgit. It is expected to fall towards 3,232 ringgit.

A rising channel indicates a lower target around 3,200 ringgit, which is close to 3,195 ringgit (hourly chart). Most likely, this round of deep drop from 4,525 ringgit could end around 3,200 ringgit.

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.