Palm oil may test support at 4,022 ringgit

SINGAPORE: Palm oil may test a support at 4,022 ringgit per tonne, a break below which could cause a fall to 3,875 ringgit.

A small double-top forming around 4,498 ringgit has been confirmed, suggesting a target around 4,022 ringgit. The pattern has a more bearish indication that the trend from 3,251 ringgit has reversed.

A retracement analysis reveals a target zone from 3,727 ringgit to 3,875 ringgit, which will be confirmed when oil breaks 4,022 ringgit.

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Resistance is at 4,204 ringgit, a break above which could lead to a gain to 4,316 ringgit. On the daily chart, the drop observes a set of projection levels.

Given that the contract pierced below a support at 4,116 ringit on the first day of the drop, it is quite likely to extend its loss into a range of 3,790-3,936 ringgit.

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