Palm oil may retest resistance at 4,128 ringgit
24.11.2022 (Business Recorder) - SINGAPORE: Palm oil may retest a resistance at 4,128 ringgit a tonne, a break below which could open the way towards 34,176 ringgit.
The contract has escaped from a falling channel.
A duplicated channel indicates a target of 4,176 ringgit.
The rise on Wednesday also confirmed a break above a resistance at 3,994 ringgit, the 38.2% retracement of the uptrend from 3,220 ringgit to 4,473 ringgit.
The break opened the way towards 4,177 ringgit, which is almost identical to 4,176 ringgit.
The drop triggered by the resistance at 4,182 ringgit is classified as a pullback towards the lower channel.
A break below 3,994 ringgit, however, would make the bullish target of 4,176 invalid.
A bearish target of 3,847 ringgit will be established accordingly. On the daily chart, the consecutive gains over the past two days indicate a completed right shoulder of an inverted head-and-shoulders.
The completion occurred a bit earlier than expected, as it is supposed to happen around 3,522 ringgit.
Given that the hourly chart signals turned bullish, which is more sensitive, the contract may rise towards 4,331 ringgit.
A close of the market on Thursday below 4,070 ringgit would suggest the extension of the right shoulder towards 3,522 ringgit.