BANGKOK, Feb 7 - Tokyo rubber futures dropped 2.4 percent on Monday on weaker oil prices and profit-taking as players liquidated contracts after prices failed to stay firmly above major resistance of 500 yen, but tight supply still lent support, dealers said. * The benchmark rubber contract on the Tokyo Commodity Exchange <0#JRU:> for July delivery fell 12.1 yen, or 2.4 percent, to settle at 490.8 yen per kg.
* "The market was overbought and prices have risen too high, so players sold contracts to take profits and avoid risk after prices failed to stay above the 500 yen level," one dealer said.
* Oil prices fell nearly 2 percent on Friday after an unfounded report about a possible announcement from Egypt set off speculation that President Hosni Mubarak could step down shortly, sparking profit-taking from which the market failed to recover. [O/R]
* Dealers said TOCOM rubber should rebound on Tuesday, with the 490 yen level being seen as key support level because limited supply in producing countries still provided supports.
* The benchmark Thai RSS3 was still offered at the record high of $6.10 per kg, the highest ever, although TOCOM prices fell, reflecting strong demand amid tight supply. [ID:nSGE71600W]
(Source: http://asia.news.yahoo.com/rtrs/20110207/tap-markets-asia-rubber-c3bb44c.html)
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