SINGAPORE (Aug 30): Palm oil may stabilize in a support zone of RM2,206-2,215 per tonne, and then retest a resistance at RM2,245.
The zone is formed by the 7% and the 14.6% projection levels of an upward wave C from RM2,197. Making this zone stronger is another support established by a trendline falling from the May 24 high of RM2,498.
Palm oil again surged above the trendline, signalling resumption of the uptrend from the July 25 low of RM2,140. The drop from the Aug 28 high of RM2,238 is classified as a pullback towards the trendline.
The pullback may end above RM2,206. So long as palm oil hovers above RM2,197, the current bullish view will remain unchanged. A break below RM2,197 could open the way towards RM2,140.
(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.)