SINGAPORE (Dec 6): The palm oil third-month contract may slide a bit further to 2,519 ringgit per tonne, to complete its downtrend from the Oct. 30 high of 2,855 ringgit.
The downtrend has been driven by a big wave C, which consists of five small waves. The fifth wave labelled 5 has briefly pierced below a support at 2,555 ringgit, the 123.6 percent projection level of the wave C. Chances are the wave 5 may extend a bit further to 2,519 ringgit.
The bullish divergence on the hourly RSI suggests a limited downside. A further drop below 2,519 ringgit could be less likely.
Should palm oil open above 2,555 ringgit in the morning session of the day, it will have a better chance of bouncing to 2,595 ringgit before falling again. - Reuters