Monday, June 3, 2013

Make The Rally Or Else 3rd Jun 2013

Monday, 3rd Jun 2013. Palm oil futures is setting to recover based on previous Friday price action but there is some obstacle along the way. Other news to follow.

"-U.S. stock futures retained Friday losses as U.S. consumer spending fell in April and incomes were static, casting the largest chunk of the economy on uncertain footing.  U.S. stocks thudded lower Friday as Wall Street closed another month of gains with a whimper after mixed economic reports. "We've had a week of mediocre news for the United States; not a soft patch, not concerning, but certainly not inspiring," said Jim Russell, senior equity strategist for U.S. Bank Wealth Management in Cincinnati. The Dow Jones Industrial AverageDJIA -1.36% fell 208.96 points to 15,115.57. The S&P 500 index SPX -1.43% lost 23.67 points to 1,630.74. The Nasdaq CompositeCOMP -1.01% shed 35.38 points to 3,455.91."

"-Japanese stocks rebounded Friday to recover some of the steep losses suffered in the previous session, aided by a slew of monthly economic data and strong cues from Wall Street.

The Nikkei Stock Average JP:NIK -2.48%  ended 1.4% to 13,774.54 a day after it plunged by 5.2%. But the benchmark still ended with a loss of 0.6% in May, after rising in each of the past nine months. The broader Topix JP:I0000 -1.47% rose 0.1% on Friday. Elsewhere in Asia, South Korea’s Kospi KR:SEU -0.40%  and Taiwan’s TaiexXX:Y9999 +0.14% rose 0.1% each. On the downside, Australia’s S&P/ASX 200 AU:XJO -0.45% ended down 0.1%, Hong Kong’s Hang Seng Index HK:HSI -0.41% fell 0.4% and the Shanghai Composite IndexCN:000001 -0.74% shed 0.7%." 
"-Oil futures finished lower on Friday, suffering losses for the week and month, as pessimism among traders over the outlook for energy demand fueled a drop in prices below $92 a barrel. The market also assessed the Organization of the Petroleum Exporting Countries’ decision to keep its oil production target unchanged, despite worries about energy demand and rising U.S. output. Crude for July delivery CLN3 -0.30%  lost $1.64, or 1.8%, to settle at $91.97 a barrel on New York Mercantile Exchange, the lowest settlement for a most-active contract since May 1, data from FactSet show."
"-July Soybeans finished up 14 1/4 at 1510, 13 off the high and 15 3/4 up from the low. November Soybeans closed up 15 at 1304 1/4. This was 15 1/2 up from the low and 10 1/2 off the high. July Soymeal closed up 6.4 at 447.2. This was 6.9 up from the low and 3.8 off the high. July Soybean Oil finished down 0.2 at 48.38, 0.5 off the high and 0.1 up from the low. Soybeans traded sharply higher on the day with the July and November contracts both up double digits. The November contract traded up to its highest level since February 8th of this year. The July/November spread found some support this morning following positive export sales data from the meal market but broke lower late in the session. Support came from planting delays and the possible negative impact on yield as a result. Net weekly export sales for soybeans came in at -108,000 tonnes for the current marketing year and 756,600 for the next marketing year for a total of 648,600. As of May 23rd, cumulative sales stand at 99.5% of the USDA forecast vs. a 5 year average of 97.5%. Sales of 12,000 tonnes are needed each week to reach the USDA forecast. Net meal sales came in at 149,200 tonnes for the current marketing year and 40,900 for the next marketing year for a total of 190,100. Cumulative meal sales stand at 101% of the USDA forecast vs. a 5 year average of 82%. Net oil sales came in at 2,900 tonnes for the current marketing year and none for the next marketing year for a total of 2,900. Cumulative oil sales stand at 84% of the USDA forecast vs. a 5 year average of 75.5%. Sales of 9,000 tonnes are needed each week to reach the USDA forecast."

FCPO- Second Support Trend Line Remain Intact. 

Palm oil futures recovered substantially on later afternoon session previous Friday, marking that the benchmark Aug still have some juice to go up this week. Trader are reminded that weak export and record high palm oil stockpiles would curb the price from surging. We are still trapped within negative fundamental here, there are more work need to be done for the palm oil futures to sustain on recovering. On contrary, market is likely to go up based on technical perspective. There is a major higher lows formed on previous Friday closed on hourly chart shown above and the second long term support trend line remain intact. In another words, we are likely to expect more short term upside this week based on previous Friday positive price action. Support area has been identified around 2,371 when the benchmark Aug manage to bounced off and rally from that level three times last week.  With this strong support area identified, market is likely recovering further as Buyers are adequate to overcome Sellers power around that value. For today, pivot point for the benchmark Aug is placed around 2,381 while resistance is pegged at 2,416.

Daily Pivot Point
R2= 2416
R1= 2407
S1= 2381
S2= 2364
 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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