Malaysia: Palm Oil Pauses Below RM4k Wall

RHB Investment Bank Bhd (RHB Research) is maintaining a bearish trading bias on the crude palm oil futures contract (FCPO) as the commodity continues to move sideways below key resistance levels, signalling that upside momentum remains capped.

The FCPO settled at RM3,899 on Wednesday, gaining RM31 from the previous close. It opened at RM3,870, dipped to a low of RM3,851, then rebounded to an intraday high of RM3,912 before paring gains. Despite printing a bullish candlestick, RHB Research noted that the rebound lacked the strength to break past significant resistance.

The technical setup still leans bearish, with FCPO trading below both its 50-day and 200-day simple moving averages (SMAs). RHB Research said this structure suggests continued downward pressure unless the price can close above RM4,000.

“As long as FCPO remains below the key RM4,000 mark, the bearish outlook stands. Any upside is likely to be capped at the RM4,100 resistance, with downside support seen at RM3,700, and further at RM3,500,” it stated.

Traders are advised to hold the short position initiated at RM4,328 (4 April close), with a stop-loss level pegged at RM4,000 to manage risk.

RHB Research believes the FCPO’s current sideways movement is likely to continue unless a strong breakout changes the technical landscape. “Until then, the commodity’s price action remains trapped within a bearish consolidation channel,” it added.

Tags: price, Crude palm oil, futures