Market Overview 26th July 2012

Thursday, 26th July 2012. Stock index rose for the first time after it went down for some retracement previously, regional index ended mostly red due to disappointing earning results on U.S market.

"- NEW YORK (MarketWatch) — U.S. stocks closed mostly lower Wednesday as an earnings miss from Apple Inc. dented cheer in the technology sector. Rising as much as 115 points during the session, the Dow industrials DJIA +0.47%   rose 58.73 points, or 0.5%, to 12,676.05. The S&P 500 index SPX -0.03%   fell nearly half a point to 1,337.89, with technology the weakest and telecommunications the strongest performer among its 10 industry groups. The Nasdaq Composite COMP -0.31%   declined 8.75 points, or 0.3%, to 2,854.24. Without Apple’s impact, the index would have finished the session with a slight gain."


"-Asia markets fell Wednesday, led by technology shares in the wake of disappointing earnings from Apple Inc., while property major Cheung Kong Holdings Ltd. dropped in Hong Kong on news it was leading a group to acquire a U.K. gas distributor. Japan’s Nikkei Stock Average JP:100000018 -1.44%  and South Korea’s Kospi KR:SEU -1.37% each ended down 1.4%, while Singapore’s Straits Times Index SG:STI -0.25%  dropped 0.3%. Hong Kong’s Hang Seng Index HK:HSI -0.14% HK:HSI -0.14% shed 0.1%, paring a sharper loss earlier in the session, Australia’s S&P/ASX 200 index AU:XJO -0.23% shed 0.2% and China’s Shanghai Composite Index CN:000001 -0.49%  slipped 0.5%."


"- Crude-oil futures ended higher Wednesday, changing direction in the last half-hour of floor trading and shaking off concerns after a surprise increase for weekly crude supplies and above-estimate increases for crude products such as gasoline. Crude for September deliveryCLU2 -0.35% rose 47 cents, or 0.5%, to settle at $88.97 a barrel on the New York Mercantile Exchange. Oil has gained nearly 1% in the past two sessions."


"-August Soybeans finished up 44 3/4 at 1694, 7 3/4 off the high and 76 up from the low. November Soybeans closed up 45 3/4 at 1615 1/4. This was 79 1/4 up from the low and 8 3/4 off the high. August Soymeal closed up 20 at 529.8. This was 32.2 up from the low and equal to the high. August Soybean Oil finished up 0.66 at 52.24, 0.39 off the high and 0.88 up from the low. August and November soybeans traded sharply higher into the close but fell off session highs. Traders and end users sought coverage on renewed fears that the recent drought and future weather conditions will diminish soybean yield further. August soybean meal is up $18 while soybean oil is up 61. The warmest temperatures in the Midwest will be seen today and the 6-10 day weather maps continue to keep above normal temperatures in the central and western Midwest. The western Corn Belt will see a break in temperatures this weekend and light rainfall is expected but above normal temperatures is expected to return next week. The delta is also expected to see restricted rainfall, especially in the north where topsoil moisture conditions are already short. Soybeans retraced nearly all of yesterday's move lower which added to the positive tone. Outside markets were positive today as optimism grows that central banks will enact new monetary policies to fight global deflation."

FKLI- Upside Resume 

Well well, what did I tell you previously, "typical retracement upside remain intact" and it shows yesterday when the index futures for July contract recovered about 10 points to settle higher at 1,639. Both index equities will keep on recovering despite weaker performance on other regional indices. Market is having some mild correction previously and likely to resume its preceding uptrend based on yesterday bullish engulfing candle. Even though the market open lower to 1,623.50, Buyers quickly step in and accumulate their Long positions for the remaining session. As a result, the July contract rose up to 1,640.50 level, breaching major resistance level at 1,640 level. Technically, we are likely to see a lower highs formed on daily chart (shown above) after the market manage to recovered up to 1,640.50 level yesterday. As mentioned regularly, Bullish trend formation always contain with higher high and higher low candle formation and it is always a better indication to tell the strength of that particular uptrend. If you have to ask how strong for this uptrend, it will be strong enough to create another higher highs, likely next week. For today, pivot support is located around 1,623 while resistance is pegged at 1,649.

Daily Pivot Point
R2=1649
R1= 1640
S1= 1623
S2= 1615

FCPO- Sell-Off Might Halt, Downside Risk Still Presence.

CPO futures manage to recovered yesterday along as Soy oil rebounded during Asia trading session. The most active traded Soy oil contract rose about 0.58 cents to 52.16 cents per pound on 6.20PM +8GMT. Meanwhile, the benchmark Oct rose about RM25 to settle higher at 2,951 level, it dropped down to 2,898 level on morning session. The force of Buyers and Sellers are somewhat balance on the mid day but Buyers are likely regained control on the end of the day. Sentiment on palm oil continue to be weak judging on deteriorating export figures, reported by SGS and ITS for the 1-25th July vs June. On technical perspective, the benchmark Oct did not create any visible formation yet except higher low formed on 60 minutes and below time frame. On short term basis, market is poised to recover further judging on lower time frame as there was at least a higher low  candle formation formed on 60 minutes and below chart. But sentiment can be quickly resume to Bearish / Bullish if there is any significant movement occur on Soy oil (overnight). For today, support is located around 2,914 while resistance is pegged at 2,971.

Daily Pivot Point
R2=2991
R1=2971
S1=2914
S2= 2877
 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.