SINGAPORE: Palm oil may drop further into a range of 3,837-3,891 ringgit a tonne, probably after a moderate bounce to 4,029 ringgit.

The contract is riding on a wave c, the third wave of a three-wave cycle from 4,497 ringgit.

This wave is capable of travelling into 3,590-3,861 ringgit range.

Before it extends below 3,787 ringgit, the wave c is expected to closely observe a set of retracements on the fall to this level from 4,497 ringgit.

The contract seems to be stabilizing around a rising trendline.

The stabilisation may only trigger a weak bounce towards 4,029-4,058 ringgit.

The bounce may not occur if palm oil opens far below 3,955 ringgit on Monday.

Malaysia keeps December crude palm oil export duty at 8%

On the daily chart, the right shoulder of an inverted head-and-shoulders is extending towards a range of 3,522-3,647 ringgit, assuming that these shoulders are roughly symmetrical.

Key resistance is at 4,070 ringgit, a break above which may lead to a gain into 4,331-4,543 ringgit range.