SINGAPORE (March 8): Palm oil may break a support at RM2,117 per tonne, and fall to the next support at RM2,1094, as the downtrend from the Feb 7 high of RM2,344 remains steady.
The first support is provided by the 200 projection level of a downward wave c from RM2,311, while the second by the 61.8% retracement on the uptrend from RM1,940 to RM2,344.
The current downtrend consists of five waves that have been unfolding within a falling channel, which suggests a target around RM2,035. Resistance is at RM2,154, a break above which could lead to a gain to RM2,177.
On the daily chart, palm oil fell below a support at RM2,144 again, the 100% projection level of a wave (C). This support could have been broken and the break opened the way towards the range of RM2,034-2,091.
(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.)