SINGAPORE: Palm oil is biased to fall into a range of 3,958-4,001 ringgit per tonne, following its failure to break a resistance at 4,194 ringgit.
Despite its two attempts, the contract was still unable to overcome this barrier and fulfil its target of 4,253 ringgit.
A top seems to be forming around this 4,194 ringgit.
The following correction is expected to be as deep and lasting as the one from the Oct. 7 high of 3,846 ringgit.
Palm oil may test resistance zone of 4,184-4,194 range ringgit
A break above 4,194 ringgit could lead to a gain into 4,253-4,322 ringgit range.
On the daily chart, the pattern from Sept. 8 has been confirmed as an inverted head-and-shoulders, suggesting a target of 4,495 ringgit.
However, the contract seems to have lost its momentum after climbing above a resistance at 4,070 ringgit, as indicated by the doji on Thursday.
A pullback towards the neckline looks immediate.
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