SINGAPORE (May 30): Palm oil may rise to RM2,148 per tonne, driven by a wave C.

This is the third wave of a presumed three-wave cycle from the May 13 low of RM1,960. It has briefly travelled above its 76.4% projection level at RM2,111. It is likely to extend to RM2,148, which is pointed by a rising trendline.

Support is at RM2,089, a break below which could cause a loss into RM2,052-2,071. On the daily chart, palm oil is poised to test a pivotal resistance at RM2,144, the 100% projection level of a downtrend from RM2,896.

A break above this resistance will not only confirm an escape of the price from a falling channel, but also significantly increase the chance of a double-bottom around RM1,967. The pattern suggests a target around RM2,750.

(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.)