Wednesday, May 8, 2013

FCPO Heading For Temporary Recovery, The Most 8th May 2013.

Wednesday, 8th May 2013. Commodities futures for palm oil manage to recover up to 2,259 yesterday after it corrected for the past few sessions last week. Other news to follow.

"- U.S. stocks rose on Tuesday, with the Dow industrials closing above 15,000 for the first time, after Australia cut its refinancing rate and satellite-TV provider DirecTV and watch maker Fossil Inc. reported improved earnings. Wall Street’s extended record run comes amid a bull market that started a fifth year in March. U.S. equities have been supported by the Federal Reserve’s three rounds of Treasury purchases as well as by corporate America’s record profits. Rising to a record intraday high of 15,056.67, the Dow industrialsDJIA +0.58%  climbed 87.31 points to 15,056.20, with 23 of its 30 components rising. After closing at records the prior three sessions, the S&P 500 index SPX +0.52%on Tuesday extended that run, rising 8.46 points to 1,625.96, with telecommunications and industrials leading the gains that included all but technology of its 10 basic sectors."

"-Most Asian markets rose Wednesday as another record finish for key U.S. equity indexes helped Japanese stocks extend their solid rally from the previous session, while high-dividend yielding shares led a rebound in Australia.

Japan’s Nikkei Stock Average JP:NIK +0.93%  climbed 0.8% to 14,297.89, climbing further a day after it soared 3.6% to finish at its highest level since June 2008.
South Korea’s Kospi KR:SEU +0.19%  was flat in choppy trade. Australia’s S&P/ASX 200 IndexAU:XJO +0.64% , which ended lower on Tuesday after the Reserve Bank of Australia (RBA) surprised most economists with an interest rate cut, rose 0.5%. The gains came as some banks and telecommunication major Telstra Corp. recovered on the back of their dividend appeal."
"-Oil futures fell on Tuesday to mark their first loss in four sessions, pressured by a report that Saudi Arabia boosted its crude output by nearly 2% in April as traders awaited weekly updates on U.S. petroleum supplies.
The market also monitored geopolitical tensions in the Middle East, which continues to provide some support to prices. Crude oil for June delivery CLM3 -0.07%  shed 54 cents, or 0.6%, to settle at $95.62 a barrel on the New York Mercantile Exchange. Prices had tallied a gain of more than $5, or nearly 6%, over the past three sessions."
"- May Soybeans finished up 19 at 1463 1/2, 1/2 off the high and 18 1/2 up from the low. July Soybeans closed up 13 at 1382 1/4. This was 14 3/4 up from the low and 1 3/4 off the high.

July Soymeal closed up 2.1 at 403.3. This was 2.6 up from the low and 2.6 off the high. July Soybean Oil finished up 0.38 at 49.14, 0.06 off the high and 0.55 up from the low. The soybean complex traded higher throughout the session led mostly by gains in the May/July spread as it continues to be well supported, along with the July/November; due to the firm US cash markets and steady crush demand. Some processors are expected to take some downtime in May but domestic crush margins remain rather healthy given the firm meal basis which is helping to offset the explosive input costs from the soybean basis. Soybean and meal shipments are beginning to pick up in Argentina and Brazil but the pace will need to improve to satisfy world demand. Argentina meal shipments for April were estimated at 2.1 million tonnes, nearly unchanged from year ago levels. The cumulative shipment pace so far this marketing year is slightly lagging year ago levels. Fears that Argentina and Brazilian farmers will be tight fisted with remaining old crop soybean supplies, given falling prices, is seen as a supportive influence going forward. However some believe this may translate to a firmer cash market in South America rather than in the futures market, much like the US."

FCPO- Short Live Recovery, Or Else ? 

Technical analysis is a study based on past price or some might called it historical parameters to anticipate future movement of price. I do not know whether I get that right according to the "book" but that is how I interpret technical analysis. Trend line or just line for some traders are very effective to visualize where is the next pivot point for the price to re-act. These line are best describe as support and resistance trend line in the chart. From the hourly chart shown above, it is clear that the resistance trend line would serve as early indicator where does the rally should end if the market did recovery from yesterday close. There is periodicaly no 100% in any studies or analysis you can come up with, as there will be no 100% confirm that the benchmark July will retrace from this resistance trend line when it did rally later. What we can do from here is to gauge how likely the price would retrace if it does touches the resistance trend (2,278 level) was to look at how many times the price did retrace after approaching this resistance trend line. Chances are very likely for the July contract to retrace because price does retrace at least twice approaching that negative curve resistance trend line. Short term technical outlook for benchmark July will be interestingly Bullish higher low formed on hourly chart above when the July contract manage to recover in the late afternoon session yesterday. Bear in mind, Bears are still controlling the tempo in medium term, Bulls have to prove it can sustain above 2,278~2,280 level before we can look at any role reversal for medium term. For today, pivot point for July contract is located around 2,238 while resistance is pegged around 2,275~2,280 level.

Daily Pivot Point
R2= 2292
R1= 2275
S1= 2238
S2= 2218
 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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