SINGAPORE (Jan 31): Palm oil may manage to stabilise around a support at RM3,014 per tonne and then hover above this level or bounce towards a resistance at RM3,089.
The support and the resistance are identified respectively as the 86.4% and the 100% Fibonacci projection levels of an upward wave C from the Oct 6, 2016 low of RM2,538.
On Dec 23, 2016, the support caused a decent bounce that lasted around one month. It is reasonable to assume that another weaker bounce may be triggered. A fall to RM3,004 could signal a break below RM3,014, and the next support at RM2,959 may be tested.
(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.)