The crude palm oil futures contract (FCPO) came under further profit-taking last Friday, with prices declining RM9 to close at RM4,677 per tonne, according to RHB Research.
The benchmark contract opened at RM4,690 and moved within a range of RM4,648 to RM4,698 before ending the session lower.
RHB said the latest price action suggested that market sentiment had shifted to neutral following the recent rebound from the RM4,530 support level.
The research house expects the FCPO market to enter a period of consolidation before potentially making another attempt at the RM4,900 resistance level.
Despite the recent pause, RHB said the broader bullish technical setup remains intact, with both the 50-day and 200-day simple moving average (SMA) lines continuing to trend higher.
“Despite the pause, we keep the positive trading bias,” the research house said.
RHB said further selling pressure could see FCPO prices retreat towards the immediate support at RM4,530, where the commodity is expected to potentially stage a rebound.
The next support level is identified at RM4,390.
On the upside, the first resistance stands at RM4,900, followed by RM5,100.
For traders, RHB recommended maintaining the long position initiated at the close of 23 July at RM4,710.
It placed a stop-loss level at RM4,530 to mitigate downside trading risks.
Overall, while the recent rally has lost some momentum, RHB believes the underlying technical structure continues to favour a positive trading bias, with consolidation potentially providing a base for another test of higher resistance levels.
