The Edge Markets (17/10/2017) - SINGAPORE (Oct 17): Palm oil January contract still targets a range of RM2,782-2,812 per tonne, as suggested by a Fibonacci retracement analysis and an inverted head-and-shoulders.

The range is formed by the 61.8% and the 76.4% Fibonacci retracements of the downtrend from Sept 14 high of RM2,860 to the Oct 3 low of RM2,656.

The contract seems to be stabilizing around the 50% level at RM2,758. A rise to RM2,767 could confirm the completion of the current sideways move.

The inverted head-and-shoulders suggests a target around RM2,832. A further drop will be classified as a pullback towards the neckline of the pattern. The pullback may be limited to RM2,734.

(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.)