Monday, June 10, 2013

Parabolic Rally, No Sign Of Slowing Down Yet For FCPO

Monday, 10th Jun 2013. FCPO has rallied more than 9% from the low of 2,230 last week amid better anticipation on palm oil stockpiles will reduce. Other news to follow.

FCPO- Parabolic Surge Invites Swift Retracement. 

Palm oil futures rose to the highest in almost two weeks after a survey showed that output in Malaysia, the world’s second-largest producer, might reduce  in May and exports slightly declined. The contract for August delivery ended up as much as 0.9 percent to 2,457 on the Bursa Malaysia Derivatives, the lowest and the highest price for the most-active Aug contract were travelling within 2,436~2,471. Output increased 4.6 percent to 1.43 million tons last month, while exports declined 2 percent to 1.42 million tons, this was the median of estimates from two plantation companies and three analysts in survey showed. Stockpiles dropped 3.5 percent to 1.86 million tons, the least since June 2012, the survey showed. The Malaysian Palm Oil Board is scheduled to release official data on June 10, which is today. Higher production will remain the top concern to the market and the uncertainty over demand may also dampen price outlook. Output in Malaysia may advance to a record 19.4 million tons this year after plantations in the main growing state of Sabah received ample rain, Oil World said. Exports may be as much as 18.8 million tons. Technically, there is still no significant sign for the market to reverse its Bullish role to Bearish for the moment. Medium term Bearish outlook has been changed to Bullish when the market surpasses above 2,420 level. The benchmark Aug futures that rallied last Friday marked the begining of pro-long uptrend momentum but it is likely coming down for some retracement judging from its recent parabolic surge. Volatility will be the main headlines for the market to move and there is always a posibilities market would retrace swiftly if the output and stockpiles report rise above expectation today. For today, pivot support for benchmark Aug is located around 2,438 while resistance is pegged at 2,489.

Daily Pivot Point
R2= 2489
R1= 2473
S1= 2438
S2= 2419

 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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