Malaysia: Palm Oil Futures Try To Hold The Line Above Key Average

RHB Investment Bank Bhd (RHB Research) has maintained its short positions on crude palm oil futures (FCPO), citing persistent bearish signals despite a strong rebound that lifted prices above the 200-day simple moving average (SMA) line.

According to RHB Research, the benchmark FCPO contract rose RM95 to close at RM4,063, snapping out of a recent sideways consolidation. It had opened at RM3,980 and briefly dipped to RM3,963 before staging a strong reversal to hit an intraday high of RM4,085, forming a long bullish candlestick in the process.

The research house said while the technical outlook has shown some improvement, with the FCPO attempting to stay above the 200-day SMA, the commodity remains under pressure as long as it trades below the key resistance level of RM4,150. A decisive close above that level would be needed to reverse the current correction bias.

“The bears still possess the technical upper hand. Until a breakout above RM4,150 is seen, the negative trading bias remains intact,” said RHB Research.

The house recommended traders maintain short positions initiated on June 24 at RM3,983, with a stop-loss set at RM4,150. Support levels are identified at RM3,965 and RM3,850, while resistance levels are set at RM4,150 and RM4,300.

The outlook suggests that further upside could emerge if FCPO sustains its position above the 200-day SMA, but any pullback below it may resume the downward trajectory.

Tags: futures, benchmark contract, RHB Investment Bank Bhd, prices, Crude palm oil