Monday, August 27, 2012

Market Overview 28th Aug 2012

 Tuesday, 28th Aug 2012. The FBM KLCI closed slightly unchanged while regional index ended yesterday session mixed. Investors are still looking for further positive hint before starting to accumulate again. Other news to follow.

"-- Blue-chip stocks closed lower Monday, ahead of Federal Reserve Chairman Ben Bernanke's speech at a Fed retreat later this week, while gains in shares of Apple Inc. helped lift the Nasdaq Composite. The Dow industrials DJIA -0.25%closed down 33 points, or 0.3%, at 13,124.67. The Nasdaq Composite COMP +0.11% rose 3.4 points, or 0.1%, to 3,073.19, with shares of Apple AAPL +1.88% up 1.9%. The S&P 500SPX -0.05% slipped 0.7 point to 1,410.44. "

"- Shanghai shares notched up another multi-year low Monday, while steep losses for Samsung Electronics Co. weighed in South Korea, but Japan saw modest currency-linked gains.

Japan’s Nikkei Stock Average JP:100000018 +0.16%  ended with a 0.2% gain, though it was one of the few indexes to notch gains. The Shanghai Composite Index CN:000001 -1.74%  fell 1.2% to a level not seen since January 2009, after closing at its lowest level since March 2009 on Friday. Hong Kong’s Hang Seng Index HK:HSI -0.41% lost a more modest 0.4%. Australia’s S&P/ASX 200 index AU:XJO -0.12%  traded down 0.1%, while the South Korean Kospi KR:SEU -0.10% also lost 0.1% in a choppy session as Samsung ElectronicsSSNLF +5.36% tumbled 7.7%."

"- Crude-oil futures ended lower on Monday, running out of steam after earlier gains, and gasoline futures shot up as Tropical Storm Isaac threatened the heart of the U.S. refinery industry. Crude for October delivery CLV2 -0.17%retreated 68 cents, or 0.7%, to $95.47 a barrel on the New York Mercantile Exchange. "

"-November Soybeans finished down 12 3/4 at 1718 3/4, 41 3/4 off the high and 4 3/4 up from the low. January Soybeans closed down 13 at 1711 1/4. This was 5 3/4 up from the low and 41 1/4 off the high. December Soymeal closed down 4.1 at 518.7. This was 3.4 up from the low and 13.2 off the high. December Soybean Oil finished down 0.34 at 56.56, 1.29 off the high and 0.07 up from the low. November soybeans traded lower into the close after posting a new high for the move overnight. Soybean meal and oil traded lower as well. The soybean market had a positive tone this morning after gapping higher overnight but technical sell pressure and unwinding of calendar spreads took over soon thereafter. Tropical Storm Isaac has entered the Gulf of Mexico and the storm could push as far north as Arkansas, Western Tennessee, Missouri, and Illinois. High winds and heavy rainfall could have a negative impact on maturing row crops but could aid Mississippi water levels in the short term. The 6-10 day forecast calls for a return of above normal temperatures and below normal rainfall for the central US. Spot soybean basis at various Iowa elevators fell today as farmer sales have picked up since last week. This added pressure to calendar spreads. Export inspections for the week ending August 27th were reported at 17.40 million bushels vs. 21.43 the week prior. The current inspection pace for 2011/12 now exceeds the pace needed to reach the USDA estimate. The 5 year average at this time of the crop year is 98%. Outside markets offered limited direction with the US Dollar steady on the day and US stocks slightly higher."
FKLI- Congestion At The High. 

The FBM KLCI ended unchanged yesterday follow by index futures which rose merely one point to 1,649.50 level. Most of the volume traded on derivative futures turn out to be spread positions as the August contract expiry date draws near. On external sources, traders need to watch out how deep is the China inevitable economy slow down effect for this coming third quarter and throughout the end of year as well. And for locally, earning season will soon come to end this week, traders need to seek what will be the next supportive factor to fuel up the rally. One of them is by looking at the price itself because it is the fastest thing anyone can see when the market re-act to any news. Although the index futures refuse to rally swiftly at the moment, medium term perspective for the spot month contract remain Bullish. There is not much information shown on daily chart shown above except that market is now congesting at around 1,650 level, which also serve as immediate resistance level. Traders who hold Long overnight should continue to do so as there is yet any sign of major retracement yet.  For today, pivot point support for spot month index futures is located around 1,643 while resistance is pegged at 1,653 level.

Daily Pivot Point
R2= 1653
R1= 1651
S1= 1646
S2= 1643

FCPO- Upside Showing Sign Of  Slow Down


Palm oil futures have another gap up in the morning session due to overnight Soy oil surge but much of the gain was erased in the afternoon session. To prevent profit from vaporize, Long holders prefer to cover their positions when they saw price start to dwindle down on afternoon session. Soy oil is likely having a free ride on recent crude oil price recovery but most of the rally was supported by supplies concern in U.S and encouraging imports from China. At close, the benchmark Nov went up about RM22 to 3,091, the day high and low were 3,122~3,087 while the most active traded Soy oil was traded 0.53 cents to 56.98 cents per pound at 6.30PM +8GMT. Technically, medium term outlook for the benchmark Nov remain Bullish at the moment as it manage to breached previous week high yesterday. Even though there is yet any sign of major correction, overnight traders are advised to watch out for any Bearish candle formation starting from 15 minutes time frame in order to detect any weakness earlier. Traders need to take note that there is yet any noticeable correction or lower high form since the market recovered from last week. Hence, always be mindful as you are expose to higher risk by holding more Long positions session after session. For today, pivot point support area for the benchmark Nov is located around 3,065 while resistance is pegged at 3,135 level.

Daily Pivot Point
R2= 3135
R1= 3113
S1= 3078
S2=3065
 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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