SINGAPORE (Feb 15): Palm oil may retest a support at RM2,249 per tonne, as it has completed a bounce triggered by this level.
The support is provided by the 23.6% retracement of the uptrend from RM1,940 to RM2,344. The bounce seems to have ended around a resistance at RM2,285.
An extension of the bounce will be confirmed, when palm oil breaks the resistance. A bullish target at RM2,316 will be established then.
A projection analysis on the daily chart reveals a similar target at RM2,321, the 76.4% level of a downward wave (C). A break below RM2,246 could open the way towards RM2,144. A more realistic target could be RM2,214 on the hourly chart, which is 61.8% retracement of the uptrend from RM2,134 to RM2,344.
(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.)