Monday, March 19, 2012

Market Overview 20th March 2012

 Tuesday, 20th March 2012. The FBM KLCI gained slightly after resuming for trading after the weekend while most of the regional index closed in red territory from a range trading on early session. Other news to follow.

"U.S. stock indexes on Monday wrapped up a modest-volume session with minor gains, as Apple Inc.’s dividend plans boosted the Nasdaq and home builders’ data bolstered hopes of that sector’s recovery. The Dow Jones Industrial Average DJIA +0.05%  rose 6.51 points, or 0.1%, to 13,239.13, shedding early losses near midday but trimming gains as the close neared. It had risen as much as 37 points and lost as much as 24 points. The Nasdaq Composite COMP +0.76% gained 23.06 points, or 0.8%, to 3,078.32, its highest close since Nov. 15, 2000. The S&P 500 SPX +0.40% rose 5.58 points, or 0.4%, to 1,409.75, its highest close since May 2008. Tech stocks led gains. Sectors known as defensive plays — utilities and health care — lagged. Of 10 industry groups, only utilities ended lower."

 "- Most Asian markets rose Monday as optimism about the U.S. economy and rising energy shares underpinned broad regional gains, with Japanese shares climbing for a fifth straight trading day on the back of banks and industrial robot maker Fanuc Corp. The Nikkei Stock Average JP:100000018 +0.19%  rose 0.1% to 10,141.99, its highest finish since the March 11 earthquake and nuclear disasters. South Korea’s Kospi KR:0100 +0.62%  rose 0.6% to 2,047, Australia’s S&P/ASX 200 index AU:XJO +0.34%  added 0.3% to 4,290.80 and Taiwan’s Taiex fell 0.1% to 8,043.92. China’s Shanghai Composite CN:000001 +0.23% finished 0.2% higher at 2,410.18 after a choppy trading session, while Hong Kong’s Hang Seng Index HK:HSI -0.95%  fell 1% to 21,115.29 as investors locked in profits after recent gains."

"- Oil futures on Monday settled at their highest in more than two weeks as investors were mostly positive about the global economic outlook and the dollar traded slightly lower. Crude oil futures for April delivery CLJ2 -0.31%  rose $1.03, or 1%, to end the session at $108.09 a barrel on the New York Mercantile Exchange."

"-US soybean futures end lower on profit-taking and weak cash market prices. Traders say a lack of fresh supportive news prompted profit-taking following sharp recent gains that have pushed the market to six-month highs. Lower South American soybean prices added to the pressure, traders say. Wheat and corn also fall during the session. An optimistic export outlook limits losses. May CBOT soybeans end down 7 1/2c to $13.66 1/2 a bushel.  May soybean oil closes down 0.10c to 55.40 cents/lb and May soybean meal ends down $3.50 to $370.90 per short ton."


FKLI- Bears Are Counter Attacking

 Stock index ended the day with 2.20 points gained to 1,573.60 while the index futures ended lower marginally about 4 points to 1,572 level. With a few signs that suggest immediate profit taking activities and subside strength from the Bulls, it is time to be cautious. Long holders beware especially you are holding substantial positions above 1,580 level because we are looking at the beginning of correction soon. It does not a matter of how much this retracement or correction could go but rather what we can do before it happen. This is most traders missed, to go in when the risk is the lowest or in another words when a move is about to form and to go in only after everything is confirmed. And we all know that there is no such thing as "confirmed" when trading in the market. Technically, the index futures is forming a lower high plus a small double top on daily chart above. This conditions suggest that there is less strength and commitment from the Bull to push up the market at the moment and it is letting the Bears controlling the market easily.  It is not impossible for a major correction to occur when most of the thing you read in the financial daily or CNBC are Bullish as most of the swift correction always happen when everything reported are Bullish. For today, support is located around 1,562 while resistance is pegged at 1,578~1,580 level. 
 
Daily Pivot Point
R2= 1585
R1= 1578
S1=1567
S2= 1562

 FCPO- Sign Of  Retracement

CPO futures ended lower yesterday, paving more path for further correction amid recent retracement on Soya oil and Soya bean as well. At close, the benchmark Jun losses about RM25 to 3,373 while most actively traded Soya oil contract shed about 0.35 cents to 55.16 cents per pound during Asia trading session, 5.45pm +8GMT. Technically, this is another sight of lower high and lower low that formed on the benchmark June and price is likely to retrace further. But things may not look that grim as this might turn out to be another typical correction in an uptrend market. Smooth trend is something luxury to expect in any market, but even though there is some nasty disruption to the trend, traders must not confused where is the direction of major trend  according to the time frame. If anything does go wrong from here, major support is currently place around 3,310~3,300 based on previous low.  Nonetheless, overall positive momentum remain intact with some presence of price adjustment along the way. For today, support is locate around 3,340 while resistance is pegged at 3,400 level.
 
Daily Pivot Point
R2=3428
R1=3400
S1=3356
S2=3340
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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