SINGAPORE (Oct 8): Palm oil is expected to test a resistance at 2,224 ringgit per tonne, with a good chance of breaking above this level and rising more to 2,262 ringgit.
The resistance has been established around the 61.8 percent Fibonacci projection level of an upward wave c that developed from the Sept. 22 low of 2,064 ringgit. This resistance has triggered a moderate correction, which seems to have completed around a support at 2,142 ringgit, the 38.2 percent Fibonacci retracement on the fall from the June 25 high of 2,511 ringgit to the Sept. 2 low of 1,914 ringgit.
Since palm oil has approached 2,224 ringgit again, it is highly likely that the contact will break this resistance and rise more to 2,262 ringgit, the 76.4 percent projection level.
** 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. **