KUALA LUMPUR: OSK Research is maintaining its Neutral bias view on near-term crude palm oil (CPO) prices.
It said on Friday, July 15 the immediate strong resistance now still lies at the RM3,163 per tonne level, followed by the 200-day MAV line, which is now located at the RM3,372 a tonne level.
'For support, we eyeing the RM3,031 per tonne level, followed by RM3,000. A very strong support can be found at the RM2,760-RM2,903 per tonne zone,' it said.
OSK Research said in retrospect, it started becoming cautious on CPO's near-term prices when they fell below the RM3,163 a tonne critical low last month.
'This level represents the lowest point of the 'non-classical Hammer' which was created as a result of a rather strong intra-day rebound. Hence, when such a major low is taken out, it is normally viewed as a major sentiment dampener,' it said.
The research house said this violation was also followed by another breakdown from the RM3,103 a tonne level, or the meaningful low created in November last year.
'We also mentioned in our previous update that a decisive retracement back below the RM3,000 a tonne level would alter our neutral view towards the near-term market to bearish. Since the RM3,163 / tonne level has been violated, prices have started to consolidate sideways although they did not retrace further,' it said.
OSK Research said it will see if CPO prices could return back above the RM3,163 a tonne level.
A successful bounce back would definitely improve its current precarious technical position. If not, should the RM3,000 psychological mark be violated, it simply means that the market will be extending the downtrend that started from slightly below the RM4,000 psychological mark.
It said on Friday, July 15 the immediate strong resistance now still lies at the RM3,163 per tonne level, followed by the 200-day MAV line, which is now located at the RM3,372 a tonne level.
'For support, we eyeing the RM3,031 per tonne level, followed by RM3,000. A very strong support can be found at the RM2,760-RM2,903 per tonne zone,' it said.
OSK Research said in retrospect, it started becoming cautious on CPO's near-term prices when they fell below the RM3,163 a tonne critical low last month.
'This level represents the lowest point of the 'non-classical Hammer' which was created as a result of a rather strong intra-day rebound. Hence, when such a major low is taken out, it is normally viewed as a major sentiment dampener,' it said.
The research house said this violation was also followed by another breakdown from the RM3,103 a tonne level, or the meaningful low created in November last year.
'We also mentioned in our previous update that a decisive retracement back below the RM3,000 a tonne level would alter our neutral view towards the near-term market to bearish. Since the RM3,163 / tonne level has been violated, prices have started to consolidate sideways although they did not retrace further,' it said.
OSK Research said it will see if CPO prices could return back above the RM3,163 a tonne level.
A successful bounce back would definitely improve its current precarious technical position. If not, should the RM3,000 psychological mark be violated, it simply means that the market will be extending the downtrend that started from slightly below the RM4,000 psychological mark.
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