Wednesday, November 16, 2011

Market Overview 17th Nov 2011

 Thursday, 17th Nov. The FBM KLCI ended unchanged yesterday as it hover on negative territories after open higher due to lower stock index benchmark on Asia benchmark. Other news to follow.

"-U.S. stocks fell hard Wednesday after Fitch Ratings signaled trouble for U.S. banks should Europe’s debt trouble worsen, with the crisis overseas continuing to dominate on Wall Street. Closing near session lows, the Dow Jones Industrial Average DJIA -1.58%   lost 190.57 points, or 1.6%, to 11,905.59. The S&P 500 Index SPX -1.66%   declined 20.89 points, or 1.7%, to 1,236.92, with banks hardest hit among its 10 sectors. The Nasdaq Composite Index COMP -1.73%   shed 46.59 points, or 1.7%, to 2,639.61."

"-Asian stock markets took a second straight day of losses Wednesday on worries over Europe’s fiscal health, with low volumes leading to choppy action. Tokyo and Hong Kong benchmarks quickly lost their opening gains, with the Nikkei Stock Average JP:NIK -0.92%  ending down 0.9%, and the Hang Seng Index HK:HSI -2.00%  falling 2%. The Shanghai Composite CN:000001 -2.48%  lost 2.5%, Australia’s S&P/ASX 200 AU:XJO -0.89%  fell 0.9%, and South Korea’s Kospi KR:0100 -1.59%  gave up 1.6%, also reversing from earlier gains."

"-Crude futures surpassed $102 a barrel on Wednesday to close at their best since late May as investors cheered news about a pipeline they hope will alleviate supply bottlenecks. Crude for December delivery CL1Z -0.61%  rose $3.22, or 3.2%, to $102.59 a barrel on the New York Mercantile Exchange. That was oil’s highest settlement since May 31."

"-Soybean futures close down amid profit-taking and the absence of fresh export news to sustain the recent rally. That encouraged traders to reduce some risk exposure, while a firmer dollar and economic and debt worries promoted cautious action as well. Meanwhile, traders are concerned about shutting off export demand if price push too far above $12/bushel, analysts added. CBOT January soy ended down 12 1/2c at $11.87 3/4. Soy product futures stumbled in step with soybeans, succumbing to pressure from traders taking profits on recent gains. Soyoil futures ended slightly lower, fighting off most of the selling pressure as soaring crude oil prices make biodiesel derived from soyoil more profitable, analysts say. CBOT Dec soyoil ended down 0.12c at 52.48c/lb; Dec soymeal finished down $5.00 at $296.40/short ton.

FKLI- Sideways Before The Storm

Buyers were kept in bay on the local stock market yesterday as investors trim off their position for profit taking on a quite trading session yesterday. Both volume traded on the cash composite and index futures were recorded lower yesterday pending from further development on Euro zone debt crisis. Market may need more than a good news to surge for the moment as investors are concern over the ability of European country to revive their financial stability or they might fall into the biggest or worse debt default ever. Back to our local market, the index futures is still hovering on sideways mode at the moment with major resistance and support level stood around 1,490 and 1,425 level. Traders could earn some quick bucks if they know the strategies to trade in this market condition. Trading short term and medium term will likely derive better results when the market in ranging, price is likely to rebound if it hit the second support level while profit taing activities are likely step in if the price approach the resistance level. On long term perspective, market will stay "calm (sideways) before the storm" which most "storm" will be noticeable from certain break out or break down from the range. For today, support is likely located around 1,459 while resistance is pegged at 1,477.

Daily Pivot Point
R2=1487
R1= 1477
S1= 1459
S2= 1449

FCPO- Bulls Take Charge, Again. 

CPO futures surge again yesterday amid strong sentiment on demand and supply data announced previously. Prices for palm oil are likely continuing it's upside momentum until early next year due to wet weather condition on year end currently. The expected price correction on the new benchmark Feb which happen on early session yesterday and merely retrace to 3,157 level and rise steadily on afternoon session. At close, the benchmark Feb rose RM64 to 3,242, this was the highest since 22nd July. Seem that the Buyers are still aggressive and bidding up the prices relentlessly as volume and open interest were recorded higher during that surge yesterday. Although there is no significant correction up until now after the benchmark months break out previously, there is no sign of major retracement as well, market is not showing any sign of weakness. In case if the market does retrace, traders can opt to go Long around the first support level around 3,181 with 20 points stop loss and target about 30 points gain. Other wise, wait for the next major retracement to Long and keep for position trade.

Daily Pivot Point
R2=3316
R1= 3279
S1= 3181
S2=3120
Disclaimer: Information and opinions contained in this report are for educational purposes only. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness.

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