SINGAPORE: Palm oil may gain further to 3,963 ringgit per tonne, as it has broken a resistance at 3,853 ringgit.
A retracement analysis on the downtrend from 4,425 ringgit reveals a break above the key barrier of 3,853 ringgit. The breaks increased the chance of a gain into 3,963-4,072 ringgit range. However, time is against bulls.
April 5 is one of the important 24 solar terms. Called “Bright and clear”, it is frequently identified as a turning point of market.
The uptrend is likely to reverse around 3,963 ringgit, instead of the higher 4,072 ringgit, as bulls may not be given enough time to push the price towards 4,072 ringgit.
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On the daily chart, the contract has stabilized above 3,859 ringgit.
The break above this barrier is confirmed valid.
The next resistance will be at 4,009 ringgit, which is pretty close to 3,963 ringgit (hourly chart).
Together, these resistances may stop the bounce and trigger a decent correction.
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