SINGAPORE (Jan 30): Palm oil may slide further into a range of RM2,256-2,274 per tonne, following its failure to break a resistance at RM2,322. The resistance is identified as the 276.4% projection level on an uptrend from RM1,979. The failure to overcome this barrier has triggered a decent correction, which may develop further, after extending below the support at RM2,304.
The uptrend may resume when the contract reaches the target zone, as a bullish pennant suggests a target at RM2,390. On the daily chart, palm oil failed to break a resistance at RM2,321, the 76.4% projection level of a downward wave (C) from RM2,896.
It seems that the contract is falling towards a support at RM2,246, which is slightly below the range of RM2,256-2,274.
A break above RM2,321 could lead to a gain to RM2,431.
(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.)