SINGAPORE (Aug 10): Palm oil may gain more to RM2,272 per tonne, as suggested by its wave pattern and a ratio analysis.
The contract is riding on a wave c from RM2,179. This wave narrowly missed its target at RM2,272 on Thursday. It may extend a bit towards this level.
A retracement analysis on the downtrend from RM2,498 to RM2,140 suggests a higher target at RM2,277, the 38.2% level, as palm oil has risen far above the 23.6% level at RM2,224.
A double-bottom forming around RM2,140 has been confirmed. It indicates a target at RM2,277 as well. On the daily chart, a projection analysis reveals that the contract is heading towards RM2,303, as it has cleared a resistance at RM2,226, the 86.4% level.
A fall may be limited to RM2,224.
(Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own. No information in this analysis should be considered as being business, financial or legal advice. 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.)