Wednesday, March 27, 2013

Time To Advance 27th March 2013

Wednesday, 27th March 2013. Both index futures and commodity futures on BMD are likely hovering on recovering mode this week. Palm oil futures might get some upside support from its rival product while index futures rally is likely fuel by positive momentum on local stock index. Other news to follow.

"- U.S. stocks surged Tuesday, lifting the Dow Jones Industrial Average to a record and the S&P 500 Index less than 2 points from its all-time closing high, following economic data that showed improvement in home prices and manufacturing.
 The Dow Jones Industrial Average DJIA +0.77%  advanced 111.9 points, or 0.8%, to 14,559.65. The S&P 500 SPX +0.78%  climbed 12.08 points, or 0.8%, to 1,563.77, leaving it 1.38 points from its all-time closing high set in October 2007. The Nasdaq Composite COMP +0.53%  rose 17.18 points, or 0.5%, to 3,252.48."

"-Most Asian markets declined Tuesday as investors fretted about the implications of the Cyprus bailout agreement for other euro-zone countries, with commodity and financial stocks leading the retreat. The Shanghai Composite IndexCN:000001 -1.25%  fell 1.3% to 2,297.67, leading the region’s losses. Japan’s Nikkei Stock Average JP:NIK -0.20% declined 0.6% and Australia’s S&P/ASX 200 index AU:XJO +0.45%  shed 0.8%. On the upside, Hong Kong’s Hang Seng Index HK:HSI +0.27%  finished 0.3% higher after a choppy trading session, while South Korea’s Kospi KR:SEU +0.04%  edged up 0.3%."

"- Oil futures settled above $96 a barrel on Tuesday to score their highest close in five weeks, with optimism over energy demand fed by a jump in U.S. durable goods orders. May crudeCLK3 -0.21% rose $1.53, or 1.6%, to end at $96.34 a barrel on the New York Mercantile Exchange. "

"May Soybeans finished up 9 3/4 at 1447, 2 1/2 off the high and 13 up from the low. July Soybeans closed up 9 at 1426 1/2. This was 13 up from the low and 1 1/2 off the high.
May Soymeal closed up 2.2 at 420.0. This was 2.8 up from the low and 0.7 off the high. May Soybean Oil finished up 0.31 at 50.75, 0.17 off the high and 0.53 up from the low. May soybeans traded higher on the day on concerns that the vessel backlog in Brazil will continue to delay soybean shipments to China which could shift additional demand to the US. In addition, a well followed oilseeds analyst cut their forecast of the 2013 soybean harvest in Argentina by 1.5 million tonnes to 48.5 million tonnes. This is down from the current USDA estimate of 51.5 million tonnes. The analyst also reduced the Brazil soybean crop by 0.7 million tonnes to 81.3 million tonnes vs. the current USDA estimate of 83.5 million tonnes. Cash bids in the US gulf were steady on the day but slightly lower yesterday on sluggish export demand. Processor bids in the interior of the US were firm midday. Traders noted that volume was light today ahead of the USDA report on Thursday."

FKLI- Cash Market is Fueling The Rally. 

Short holders beware as there is no telling whether the index futures would retrace on previous high at 1,668~1,670 level. Market could just blow above this previous high level and keep on rally at will as stock index is not showing any sign of stopping for the moment. Market participants might not be that sensitive to the political development on parliament dissolution at the moment. Much further rally signal was spotted when the Spot month futures went up above 1,635 ealier Monday this week. On previous Monday the March contract went up about 34 points to 1,663 before settling down at 1,655 level on closing bell. Short covering that forced Long orders to flew in the market helped the market rallied as well. Technically, we are looking at further recovery if the market able to breach above 1,668~1,670 resistance level based on previous high. Market has become Bullish on medium and short term basis, traders can opt to go Long if the market retrace down to 1,648~ 1,650 first pivot support level today.

Daily Pivot Point
R2= 1671
R1= 1663
S1= 1648
S2= 1640

FCPO- Upside Remain Intact

Yes, you heard it right, upside remain intact even after the market has retrace about 3.11% from 2,504 to 2,426 yesterday. At least on medium term, palm oil futures still able to resume its preceding upside momentum after it went down for correction. Market participants were spook by export data that came short on expectation. Export for the ending March month went down slightly ealier Monday, forcing market to re-act negatively after it was published. For this near term, palm oil futures is likely tracking  overnight rally  made from Soy oil (due to cold weather concern) as I did not see any other factor that could support price recovery other than its rival product at the moment. Daily chart suggest that this correction may prolong judging from the Bearish engulfing candle formed on previous Monday this week. Could it be a coincidence when the benchmark Jun bounced off from previous week support around 2,426 area shown on hourly chart above ? The longer each support or resistance took to formed, the more reliable the level are. If the support and resistance took a weeks to formed, there are much information stored on that level that what you might think. A breach below weekly support level bring chaotic corrections swifter that most of us expected while a breach above weekly resistance level will bring frantic uncontrollable rally, forcing Short holders to cover their positions. Technically, the benchmark Jun is still trapped on Bears control on intraday or short term perspective as there is no higher low. What we can see on 15 minutes time frame was a so called "base" from the price to fall further after the market consolidate, two hours before the market closed. For today, pivot support for the benchmark Jun is located around 2,426~ 2,428 while resistance is pegged at 2,4663

Daily Pivot Point
R2= 2466
R1= 2454
S1= 2428
S2= 2414
 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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