Wednesday, January 23, 2013

Palm Oil Rival Lend Support 23rd Jan 2013

Wednesday, 23rd Jan 2013. Palm oil gain for the second session straight yesterday amid some promising recover made by Soy oil after it resume its trading session. Other news to follow.

"-Stocks on Wall Street rose on Friday, posting gains for a third consecutive week after strong earnings from General Electric Co. and encouraging news about the U.S. debt ceiling.

The S&P 500 Index SPX +0.44% climbed 5.04 points, or 0.3%, to end at 1,485.98, its highest close since December 2007, leaving it up 1% for the week. The benchmark had broken out to the upside on Thursday, with 1,475 now seen as a support level. On Wall Street, the Dow Jones Industrial Average DJIA +0.46% gained 53.68 points, or 0.4%, to end at 13,649.70; it rose 1.2% for the week."
"- Asian markets ended on a mixed note Tuesday, with shares in Tokyo slipping after a roller-coaster ride in the wake of the Bank of Japan’s monetary policy decision, while South Korean stocks advanced amid gains for the yen. Japan’s Nikkei Stock Average JP:100000018 -0.69%  saw big moves on either side of the previous day’s close before ending down 0.4% at 10,709.93. Elsewhere in the region, South Korea’s Kospi KR:SEU +0.17% rose 0.5%, Hong Kong’s Hang Seng Index HK:HSI +0.29%climbed 0.3% and Australia’s S&P/ASX 200 AU:XJO +0.30% ended flat. China’s Shanghai Composite IndexCN:000001 -0.56% finished 0.6% lower on profit-taking after recent advances."
"-Crude-oil futures retreated from a four-month high as euro-zone finance ministers readied to meet in Brussels Monday to talk about the region’s debt trouble. In the United States, lawmakers this week vote on budget issues. In the House, Republicans plan to use a Wednesday vote on raising the debt ceiling in a bid to get Democrats to detail spending plans. Crude oil for February delivery CLG3 +0.69%  lost 9 cents, or less than 0.1%, to $95.47 a barrel in electronic trading on the New York Mercantile Exchange. The more-active March contract CLH3 +0.07%   declined 15 cents, or nearly 0.2%, to $95.89 a barrel."
"-January Soybeans finished up 20 1/4 at 1449 1/2, 11 1/4 off the high and 13 1/2 up from the low. November Soybeans closed up 20 3/4 at 1313. This was 18 up from the low and 1 3/4 off the high.
January Soymeal closed up 7.2 at 421.6. This was 6.1 up from the low and 3.7 off the high. January Soybean Oil finished up 0.75 at 52.43, 0.24 off the high and 0.49 up from the low. March soybeans traded sharply higher on the day as the US Dollar moved lower but strong export demand continues to add a supportive tone to the market. Untimely rainfall in areas of Brazil has also added a positive short term sentiment to the market as harvest is delayed. The USDA announced this morning that US private exporters sold 120,000 tonnes of soybeans to China for the 2013/14 marketing year. Healthy domestic crush margins has kept China active in the world soybean market as suppliers attempt to shift to the new crop harvest in South America. Rainfall in Mato Grosso delayed harvest for some areas over the weekend which is helping to support the trade today. Thoughts that early sales out of Brazil may need to be shifted over to the US is positive to the market amid a tightening supply outlook for the US. Inspections were positive for price direction today with 48.1 million bushels shipped vs. 39.1 the week prior and this was well above the 13.5 million bushels needed each week to reach this crop years USDA export estimate. The cumulative shipment pace is now 68% of the USDA estimate vs. the 5 year average of 52%."

FCPO- External News Help Lift Up Palm Oil

External events such as promising Soy oil recovery might have given most of the support for the palm oil futures to recovered recently. Lower Dollar index and sustainable demand over Soy have kept the price buoyed at the moment. Palm oil futures climbed for the second session yesterday even though export data does not sound that convincing at all, maybe it is already priced in. At close, the benchmark Apr went up about RM46 to settle at 2,466, total volume was recorded slightly higher to 16,312 yesterday. Judging from the strength on the yesterday price recovery that manage to breached above previous resistance level/upper range trading zone, market is poised to reverse its preceding Bearish outlook in the medium term to Bullish. But for more longer term perspective, market need to breached above the major resistance level around 2,520 level, that will later on next week. For today, market is expected to open slightly lower as there was some retracement on March Soy oil from previous high around $52.65 which currently trading at around $52.34 level. Addition to that, palm oil futures is likely having some retracement on early session and recover throughout the later session if the price went down approaching second pivot support level around 2,412 for today. However, upside potential is capped around 2,500 level for this week.

P/s: Bursa Malaysia will be closed on 24th Jan 2013 tomorrow for public holiday.

Daily Pivot Point
R2= 2500
R1= 2483
S1= 2439
S2= 2412
 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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