Tuesday, February 5, 2013

Bulls Might Taking Some Breather 5th Feb 2013

Tuesday, 5th Feb 2013. Palm oil futures might trailing the price action on Soy oil today after it went on recovering for the past two weeks. Other news to follow.

"-- U.S. stocks turned in their worst day of the year on Monday, dragged about 1% lower as investors used a reprise of European debt fears to cash out of a market that recently touched five-year highs. The Dow Jones Industrial AverageDJIA -0.93% fell 129.71 points, or 0.9%, to 13,880.08, with all but Boeing Co. BA +0.45%lower among its 30 components. On Friday it closed above 14,000 for the first time since 2007. The S&P 500 SPX -1.15% lost 17.46 points, or 1.2%, to 1,495.71. McGraw-Hill Cos.MHP -13.78% and Moody's Corp. MCO -10.66%were the two worst performers after the Wall Street Journal said U.S. and state prosecutors were ready to file charges against McGraw-Hill unit S&P Ratings. The Nasdaq CompositeCOMP -1.51% lost 47.93 points, or 1.5%, to 3,131.17."

"-Several major Asian markets rose Monday on the back of upbeat U.S. employment data, with Japan stocks also rising on good earnings reports and mainland Chinese shares climbing after data showing an improvement in services sector data. South Korean stocks fell as a strengthened won weighed on sentiment toward the nation’s exporters, while Australian shares declined on caution ahead of Tuesday’s monetary policy decision. Japan’s Nikkei Stock Average JP:100000018 -0.88%  rose 0.6%, China’s Shanghai Composite index CN:000001 -0.71%  added 0.4%, Taiwan’s Taiex XX:Y9999 -0.56%  climbed 0.9% and India’s Sensex IN:1 -0.15%  added 0.2% in afternoon trading. Elsewhere in the region, South Korea’s Kospi KR:SEU -0.82%  and Hong Kong’s Hang Seng Index HK:HSI -1.17%  gave up 0.2% each, while Australia’s S&P/ASX 200 indexAU:XJO -0.62%  slipped 0.3%.

"- Oil futures settled lower Monday, pulling back after last week's rally, on news of potential nuclear talks between the U.S.and Iran, and as political turmoil in Spain fueled a climb in the dollar. March crude CLH3 -0.15% fell $1.60, or 1.6%, to settle at $96.17 a barrel on the New York Mercantile Exchange. "
"-March Soybeans finished up 12 1/4 at 1486 1/2, 11 1/2 off the high and 11 up from the low.  March Soymeal closed up 6.1 at 434.3. This was 6.2 up from the low and 3.7 off the high. March Soybean Oil finished up 0.12 at 53.11, 0.43 off the high and 0.05 up from the low. March soybeans saw double digit gains into the closing bell on supportive demand data and a less than ideal weather forecast in Argentina. The USDA reported this morning that US private exporters sold 116,000 tonnes of soybeans to China, included in that total was 58,000 tonnes for the 2012/13 marketing year and 58,000 tonnes for the 2013/14 marketing year. Additionally, export inspections were positive to market sentiment at 53.9 million bushels vs. 40.7 the week prior. Only 11.2 million bushels are needed to ship each week to hit the current USDA forecast. The cumulative shipment pace is now 75% of the USDA export estimate vs. the 5 year average of 58%. The explosive sales and shipment pace continues to send positive vibes through the market but early gains were linked to unimpressive weekend rainfall in Argentina and a dry outlook for this week. Crop analysts are beginning to trim Argentina soybean production for this year but most continue to be upbeat on the Brazilian outlook with some estimates as high as 85 million tonnes while others are coming in between 81-82 million tonnes. The USDA is currently estimating production at 82.50 million tonnes.

FCPO- Some Profit Taking Activities Likely Take Place Soon. 

No Bullish trend will stay on going forever without any profit taking or corrections along the way. Market will retrace when it hit certain monthly high due to some un-realistic fears. That is why there is series of higher lows were created when the price is consider moving upwards or moving in positive momentum. For today, weakness is expected to occur on the benchmark April judging on overnight Soy oil that made some correction after it surge above 53.00 per pound on earlier Monday. Not only that, there was the first Bearish candle formation occur on 15 minutes time frame. That may signifies some minor correction on palm oil futures for short term basis. For illustration on hourly chart, the benchmark April is expected to breach below the lower trading range and recover after that as market is still hovering on Bullish momentum on medium term basis. Nonetheless, pay attention to today's pivot point for second support level located around 2,529~2,520. The benchmark April is poised to have major retracement if this area is violated.

Daily Pivot Point
R2= 2609
R1= 2586
S1= 2546
S2= 2529
 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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