Crude palm oil futures (FCPO) extended their decline on Wednesday, falling RM42 to close at RM4,768 per tonne as prices breached the key RM4,800 support level, signalling further downside risks in the near term.
According to the technical market report, FCPO opened at RM4,818 before trading between an intraday high of RM4,828 and a low of RM4,723. It subsequently settled at RM4,768, forming a fresh lower-low bearish candlestick.
The latest price movement indicates that selling pressure is strengthening following the commodity’s decline below its 50-day simple moving average (SMA).
The report said the bearish breakout could open the way for further corrections towards the 200-day SMA, although a technical rebound near RM4,700 remains possible.
The report identified RM4,700 as the immediate support level, followed by RM4,600 if selling pressure persists.
On the upside, resistance is seen at RM4,850, followed by RM4,950.
Following the breach of the RM4,800 stop-loss threshold, the technical trading outlook has shifted from positive to negative.
The report said long positions initiated at RM4,710 on July 23 had been closed, with short positions initiated at Wednesday’s closing price of RM4,768.
The new stop-loss level has been set at RM4,950.
While FCPO could stage a short-term recovery around RM4,700, the report cautioned that support levels tend to be less reliable during a bearish trading phase, leaving the commodity vulnerable to further declines.
