Sunday, December 2, 2012

Possible Lower High Formed On FKLI 3rd Dec 2012

Monday, 3rd Dec 2012. Index futures closed lower last Friday as there was inadequate support from stock index rally, most traders prefer to cover their Long positions ahead of weekend and fear of fiscal cliff. Other news to follow.

"- U.S. stocks ended little changed Friday, with the Nasdaq Composite scoring its first positive November since 2009 as the political rhetoric over the budget continued. The Dow Jones Industrial Average DJIA +0.03%  rose 3.76 points to 13,025.58, leaving it 0.1% higher for the week and off 0.5% from the month-ago closeUp 0.5% for the week and 0.3% for the month, the S&P 500 Index SPX +0.02%  finished with a fractional gain at 1,416.18, with the technology sector hardest hit and defensive industries the best performing. The Nasdaq Composite COMP -0.06%  fell less than 2 points to 3,010.24, up 1.5% for the week and 1.1% for the month."

"- Most Asian stocks rose Friday as investors took in their stride indications that no major progress had been made to avert the U.S. fiscal cliff, with Chinese shares rebounding from near four-year lows to snap a four-day losing streak.

Japan’s Nikkei Stock Average JP:100000018 +0.48% rose 0.5%, Australia’s S&P/ASX 200AU:XJO +0.63% added 0.6%, China’s Shanghai Composite CN:000001 +0.85%  advanced 0.9%, Hong Kong’s Hang Seng Index HK:HSI +0.49%  climbed 0.5% and Taiwan’s TaiexXX:Y9999 +1.02%  rallied 1%."

"-  Oil futures climbed Friday, scoring gains for the week and month as traders continued to focus on talks in Washington to avert the fiscal cliff of spending cuts and tax hikes. Supply risks linked to the Middle East also provided support. January crude oil CLF3 +0.99% rose 84 cents, or 1%, to settle at $88.91 a barrel on the New York Mercantile Exchange. Based on the front-month contract settlements, oil futures gained 0.7% from a week ago, and was up 3.1% for the month."

"-January Soybeans finished down 9 1/4 at 1438 3/4, 13 1/4 off the high and 9 3/4 up from the low. March Soybeans closed down 8 1/2 at 1432 1/2. This was 10 1/2 up from the low and 11 3/4 off the high. December Soymeal closed up 0.8 at 443.5. This was 5.8 up from the low and equal to the high.
December Soybean Oil finished down 0.36 at 49.41, 0.46 off the high and 0.23 up from the low. January soybeans traded lower on the day but managed to close off the low end of the daily range. Meal saw modest gains while oil was lower on the day. Weakness in the corn and wheat market added to the negative sentiment. Outside market volatility and a somewhat favorable weather forecast in South America has limited the bull camps ability to push futures higher in the short term. However, strong soybean demand and the fact that the US has already sold the entire soybean oil USDA export estimate for the marketing year is offering support. Basis held near a 3 month high in the Gulf of Mexico as traders scramble to get their hands on available supplies on the Mississippi River. Rainfall is expected to be light in Midwest over the next 2 weeks which could drop Mississippi River water levels even further and may disrupt barge traffic. China domestic crush margins have turned positive in the last couple weeks which could boost Chinese purchases of US soybeans before year end. The strong demand from China could limit the downside of the market in the coming weeks but high market volatility is expected."

FKLI- Still Have Some Room To Recover

Equity market closed in mixed note on previous Friday following the recent Sell-off that lasted about three weeks. Stock index closed higher about 3.51 points to 1,610.83 while index futures for Dec contract ended lower about 3 points to 1,607.50. Major support based on previous monthly low around 1,585 level remain intact but might not be for long. It was unpleasant sight for the index futures to closed lower on previous Friday as this Bearish candle may mark the end of temporary rebound if the market continue to retrace today. Although it is still early, the Bearish candle formation or lower high form on daily chart above suggest that the path for further recovery is filled with treacherous road. In other words, it is easier for the market to retrace rather than head uphill and recover. On regional economy development, the Greece debt crisis remain a thread to the financial stability on European Union as there was no prudent solution to address Greece deep debt. Fiscal cliff remain elusive at the moment as there was yet any solid plan to address this worries, word out there might be tax hikes couple with fiscal spending cuts were among the plan that will be reveal soon.  For today, pivot support for Dec contract is located around 1,602 while resistance is pegged at 1,615.

Daily Pivot Point
R2= 1623
R1= 1615
S1= 1602
S2= 1597

FCPO- More Weakness Ahead.

It was a volatile week for commodities futures as price swing can easily exceed 40 points recently. Driven by weak price outlook on Soy oil and expectation on climbing stocks, the benchmark Feb ended RM16 to 2,370, the day high and low was traded 2,391~2,359. Volume was traded thinner to 10,556 lots. Even though there are series of lower high and lower low formed, market did not tumble after it formed another lower low below 2,370 level. The last minute recovery made on previous Friday might due to better expectation on palm oil export figures for Nov that will be release on 10th Dec, Monday. Unfortunately, this mildly bullish expectation would not save the market to continue retrace soon judging from Bearish candle formation formed so far. For today, market is expected to open lower due to weak overnight closing value on Soy oil. My initial assessment reveal that there won't be frantic Selling activities even if the benchmark Feb open or breach below previous Friday low around 2,359. Market might recover gradually as low palm oil price are likely to attract bargain hunters. Pivot support for the benchmark Feb is located around 2,341 while resistance is pegged at 2,405.

Daily Pivot Point
R2= 2405
R1= 2387
S1= 2355
S2= 2341
 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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