Sunday, December 9, 2012

Buying Time Before The Sell Off 10th Dec 2012

Monday, 10th Dec 2012. Stock index manage to clinch on some gains last week as most of the trading participants are expecting window dressing activities throughout the end of 2012. Other news to follow.

"-Most U.S. stocks finished higher Friday as better-than-expected, but shaky, jobs numbers appeared to outweigh a drop in December consumer sentiment. The Dow Jones Industrial AverageDJIA +0.62% rose 81.09 points, or 0.6%, to close at 13,155.13, for a gain of 1% for the week. The S&P 500 Index SPX +0.29% finished up 4.13 points, or 0.3%, at 1,418.07, for a 0.1% gain for the week. The Nasdaq Composite Index COMP -0.38% , however, closed down 11.23 points, or 0.4%, to 2,978.04, for a weekly loss of 1.1%,"

"- Asia stocks rose on Friday, although the strength of the gains varied between markets, ahead of jobs data that’s expected to provide some more clues about the health of the U.S. economy. Hong Kong’s Hang Seng Index HK:HSI -0.26%  climbed 0.2% to move back toward a level not seen since August 2011, while the Shanghai Composite index CN:000001 +1.60% jumped 1.1% to move further away from recent multi-year lows. Japan’s Nikkei Stock Average JP:100000018 -0.19%  slipped 0.2% but remained around seven-month highs, while South Korea's Kospi KR:SEU +0.40%  rose 0.4% to mid-October levels while Australia’s S&P/ASX 200 index AU:XJO +0.94%  advanced 0.9% to close at a seven-week high."
"-Oil futures settled lower Friday, and lost more than 3% for the week as traders mulled the latest economic data for hints on oil demand. January crude oilCLF3 -0.32% fell 33 cents, or 0.4%, to settle at $85.93 a barrel on the New York Mercantile Exchange. It settled below $86 for the first time since Nov. 15. For the week, prices lost 3.4%."

"-January Soybeans finished down 19 at 1472 1/4, 26 off the high and 2 1/4 up from the low. March Soybeans closed down 14 at 1472. This was 2 1/2 up from the low and 21 3/4 off the high.
January Soymeal closed down 7.8 at 442.9. This was 0.9 up from the low and 10.0 off the high. January Soybean Oil finished down 0.07 at 51.13, 0.25 off the high and 0.37 up from the low. January soybeans traded sharply lower on the day on weaker outside markets, profit taking, and pressure that spilled over from a sharply lower corn market. Demand from China continues to add a bullish tilt to the market place and the USDA announced this morning that exporters sold 115,000 tonnes of soybeans to China for this crop year. Cash markets are firm in the Midwest and basis has surged in the PNW this week on rumors that up to 6 cargos of soybeans have been sold to China. The market is looking ahead to a large South American crop at the moment which could provide pressure long term. Rainfall in Argentina will back off today and a drier pattern will persist into next week. This should help move the soybean planting pace which is currently estimated at 54% vs. 69% last year. Weather in Brazil remains favorable with a good mixture of light rainfall and sunshine. The USDA currently has Brazil soybean production at 81 million tonnes but some believe the USDA may increase production on next week's report to 81.50 or 82 million tonnes."

FKLI- Window Dressing Helps Recovering ? 

Window dressing or not, market will continue its preceding Bearish price action if there is any Sell-off below major support level. Do not be surprise when there is any Sell-off towards the end of this year, it is just another event market can achieve, easily. With most of regional market barely recorded any impressive rally due to grim economy outlook on European countries and fore coming U.S fiscal cliff fear, market is going to absorb these bad sentiment soon. On index futures, the Dec contract medium term Bearish trend remain intact as the index is far from showing any promising sign so far. Things would be entirely different if we look at intraday or more short term basis, the higher lows and higher high candles formed so far may signifies Bullish dominance for the market to recover further this week. This short term price action can be identified by looking at smaller term time frame such as hourly and minutes chart. For FKLI, one of the best time frame to identified short term price action or market direction will be looking at hourly chart. Although there is evidence for the path to recovery is plotted by the higher high and higher lows candle formation formed on hourly chart above, these higher low area will be use as immediate support level if anything should go wrong from here. Current temporary recovery made so far may be erase if the market manage to breach below last Friday previous low around 1,612~1,611 level. Else the Dec contract is expected to rally again if previous Friday high at 1619.50 is taken out today.

Daily Pivot Point
R2= 1,623
R1= 1,619
S1= 1,611
S2= 1,608

FCPO- Temporary Rebound

Palm oil price manage to breach previous Tuesday high at 2,319 on previous Friday but unfortunately those rally did not last long when it retrace swiftly on evening session. Most of the gain made up to 2,342 was quickly erased minutes after that as market participants are still concern about the record high palm oil stockpiles that might hit above 2.6 millions tons. Apart from that, most gain you see in the future might be short live due to high stocks couple with weak demand so far. Fail up swing or short live rally is expected to happen again if the Soy oil manage to recover overnight due to unfavourable weather to Soy crops on major exporter, Argentina . In another words, market is expected to open higher due to Soy oil overnight recovery and retrace gradually after that. Technically, nothing has changed so far, medium term perspective remain negative with more Bearish price action if the benchmark Feb manage to breach below current descending triangle formation shown on daily chart above. If this event materialise, market is poised to correct until the next psychological support around 2,200 level. With current record high open interest in palm oil futures there is no telling where is the bottom, market can correct even further as those Long holders in the market have to cover their Long positions massively. Mean while for short term perspective, market is taking its time hovering on ranging session. For today, pivot support for the benchmark Feb is located around 2,272 while resistance is pegged at 2,366.

Daily Pivot Point
R2= 2,366
R1= 2,331
S1= 2,272
S2= 2,248
 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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