SINGAPORE: Palm oil still targets 5,094 ringgit per tonne, as suggested by its wave pattern.

The contract is riding on a wave 5, which is supposed to travel above the peak of the preceding wave 3 at 5,053 ringgit.

A retracement analysis on the fall from 5,220 ringgit reveals a resistance at 5,001 ringgit, around which a consolidation is ongoing.

As along as the contract hovers above 4,962 ringgit, the target at 5,094 ringgit will remain intact.

A break below 4,962 ringgit could indicate a reversal of the uptrend. A bearish target of 4,865 ringgit will be established accordingly.

On the daily chart, the contract faces a resistance at 5,082 ringgit, which is near 5,094 ringgit (hourly chart).

The resistance is strengthened by two other ones, respectively at 5,069 ringgit, the Jan. 19, 2021 high and 5,086 ringgit, the Nov. 3, 2021 high.

The contract seems to have lost its bullish momentum under these resistances.

The risk for a deep correction is increasing.

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.