Thursday, January 31, 2013

Went Passed The Upper Range / Resistance 31st Jan 2013

Thursday, 31st Jan 2013. Palm oil futures continue to sail north this week amid recent recovery from Soy oil that blew passed 52.40 cents per pound overnight. 

"-U.S. stocks dropped on Wednesday, retreating from five-year highs after the Federal Reserve said growth in economic activity paused in recent months, and as fourth-quarter data showed a surprise contraction in gross domestic product.

The Federal Open Market Committee kept interest rates near zero and maintained its aggressive bond-buying program. The Dow Jones Industrial AverageDJIA -0.32% dropped 44 points, or 0.3%, at 13,910.42. The S&P 500 Index SPX -0.39% dropped 5.88 points, or 0.4%, at 1,501.96, with the industrial sector the worst performer and utilities the best of its 10 major industry groups. The Nasdaq Composite Index COMP -0.36% fell 11.35 points, or 0.4%, at 3,142.31, finding some support by a nearly 5% rise in shares of Amazon.com Inc. AMZN +4.77% a day after the online retailer reported better-than-expected fourth-quarter profit margins."
"- An improved economic outlook boosted Asian markets Wednesday, lifting stocks in Hong Kong and Australia to near two-year highs, while Japanese shares ended at their highest level in 33 months, also fueled by earnings optimism. Japan’s Nikkei Stock Average JP:100000018 -0.17% surged 2.3% to end at its best level since April 27, 2010. Hong Kong’s Hang Seng Index HK:HSI +0.71% rose 0.7% and Australia’s S&P/ASX 200AU:XJO -0.25%  climbed 0.2% to reach their highest closing values since April 2011. The session marked a tenth day of gains for the Australian benchmark. China’s Shanghai Composite Index CN:000001 +1.00% added 1%, while South Korea’s Kospi KR:SEU -0.35%  and Taiwan’s Taiex XX:Y9999 +0.40%  each advanced 0.4%."

"-March Soybeans finished up 27 1/4 at 1479, 2 3/4 off the high and 32 up from the low. November Soybeans closed up 20 at 1332 3/4. This was 23 3/4 up from the low and 4 1/4 off the high.
March Soymeal closed up 9 at 432.7. This was 10.7 up from the low and 1.6 off the high. March Soybean Oil finished up 0.89 at 52.6, 0.11 off the high and 1 up from the low. The soybean complex traded sharply higher on the day as the weather outlook for Argentina continues to look dry over the next 2 weeks with the exception of a rain event at the end of this week which will be closely monitored. Brazil conditions continue to be mostly favorable but delays to the harvest in Mato Grosso is causing vessel lineups in the ports which could shift spot demand back to the US. This could be supportive short term to the market. The US Dollar was sharply lower on the day after a worse than expected GDP report which added strength to the broader commodity complex. The USDA reported this morning that US exporters sold 175,000 tonnes of US soybeans to China for the 2013/14 marketing year. This was the second sale of the week to China which brings the weekly total to 395,000 tonnes. A large grain producer company in South America released production estimates this morning and pegged Brazil production at 80-81 million tonnes vs. the current USDA estimate of 82.50 million tonnes. Argentina production was pegged at 50 million tonnes vs. the current USDA estimate of 54 million tonnes."
FCPO- Recovering Above 2,500 For the First Time. 

Palm oil futures is getting much positive effect from the recent export tax hike on Indonesia for their palm oil international trade. The Indonesia officials will increase their Feb crude palm oil export tax about 2%, making it less attractive and lesser profit margin for the Indonesian to export the goods. It seems that trading participants are ignoring weak export data and rather focus on other positive fundamental to support price recovering. Most probable or solid support will come from overnight price recovery from Soy and Soy oil. Soy oil for March  finished up 0.89 at 52.60, a substantial recovery made from dry weather outlook on South America and lower dollar value recently. On the technical side, the benchmark April is likely continue to recover today judging from previous positive momentum that overtook above the 2,500 psychological resistance level. Market is likely open higher today due to promising gain made by Soy oil. But if it open passed above 2,520 level, traders can expect some minor pull back due to overbought reading. Long term Bearish perspective will be revise if the market manage to close above 2,520 level at the close of today's session.

P/s: Bursa Derivative will be closed for Federal Territory holiday tomorrow, 1st Feb 2013.

Daily Pivot Point
R2= 2536
R1= 2523
S1= 2485
S2= 2460
 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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