SINGAPORE: Palm oil is expected to test a support at 4,085 ringgit per tonne, a break below may open the way towards 3,857 ringgit.
The contract remains sideways around a resistance at 4,269 ringgit, after a quick drop to 4,085 ringgit on Wednesday.
Despite its endeavour to regain its rise, palm oil failed to climb above the August 24 high of 4,350 ringgit.
The weakness proves the rise from the Aug. 19 low of 4,000 to be a bounce against the fall from the August 12 high of 4,495 ringgit.
The uptrend from the July 14 low of 3,489 ringgit may have reversed at 4,495 ringgit.
A break above 4,350 ringgit may lead to a gain into 4,452-4,680 ringgit. On the daily chart, the contract failed to break a resistance at 4,331 ringgit.
The failure offers the market a good excuse to retrace to 4,070 ringgit.
A wave count suggesting the progress of a wave (5) looks more convincing.
This wave will be confirmed when the contract breaks 4,070 ringgit.