Sunday, July 14, 2013

Impending Pam Oil Stock Piles Increased Gave Way To More Bearish Market 15th July 2013

Monday, 15th July 2013, Palm oil futures takes the fall as Soy inventories concern likely increase even further this month. Other news to follow. 

"-U.S. stocks on Friday recorded a third week of gains, with the Dow industrials and the S&P 500 tallying record closes following upbeat earnings from two major banks. The Dow Jones Industrial Average DJIA +0.02%  climbed 3.38 points to 15,464.30, an all-time closing high that had it up 2.2% from the week-ago close. Up 3% for the week and also finishing at a record, the S&P 500 SPX +0.31%  added 5.17 points, or 0.3%, to 1,680.19, with financials pacing its gains."

"- Chinese stocks retreated Friday as caution set in ahead of economic growth data due next week, while Australian and Japanese shares climbed after key U.S. indexes hit a record high.

The Shanghai Composite CN:SHCOMP -1.62%  fell 1.6% after a three-day winning streak that included a 3.2% jump on Thursday. The drop came amid concern that official data due Monday may signal a sharp slowdown in gross domestic product growth in the second quarter. The index ended the week with a 1.6% gain. Meanwhile, Hong Kong’s Hang Seng Index HK:HSI -0.75%  fell 0.8%, while South Korea’s Kospi KR:SEU -0.41% dropped 0.4%, after both rose more than 2% on Thursday. On the upside, Australia’s S&P/ASX 200 AU:XJO +0.17%  and Japan’s Nikkei Stock Average JP:NIK +0.23%  each ended 0.2% higher, while Taiwan’s Taiex XX:Y9999 +0.50% added 0.5%."
"- Oil futuresclosed higher on Friday, just short of the $106-a-barrel level, to tally a weekly gain of 2.6%. The Federal Reserve's accommodative monetary policy "coupled with several stronger-than-anticipated earnings reports have pushed investors to bet on additional demand for global energy," said Jonathan Citrin, founder and executive chairman of CitrinGroup. August crude CLQ3 +1.28% rose $1.04, or 1%, to settle at $105.95 a barrel on the New York Mercantile Exchange. Prices marked their third weekly climb in a row."

"-August Soybeans finished down 43 at 1429, 49 off the high and 3 up from the low. November Soybeans closed down 33 1/2 at 1257 1/4. This was 2 1/4 up from the low and 39 3/4 off the high.
August Soymeal closed down 15.1 at 442.9. This was 0.9 up from the low and 18.7 off the high. August Soybean Oil finished down 0.31 at 46.22, 0.53 off the high and 0.21 up from the low. The soybean market collapsed at the opening bell and losses extended into the end of the session on a more favorable weather outlook into next week and into late July. The July contract had an extremely wide and volatile range today as it expired. The eastern Corn Belt soybean basis fell like a rock with some indicating increases in farmer sales. Cash crush margins remain very healthy for central US processors with NOPA crush being reported on Monday. Many traders expect to see a strong pace of crush for these reasons. Meal and oil traded down with soybeans on profit taking ahead of the weekend. Soybean oil continues to deal with its own set of bearish fundamentals with Argentina and Malaysian oil offers trading at a rather large discount to US oil. Furthermore, with the strong US crush and lack of exports, some expect to see a healthy US inventory of oil on Monday's NOPA report."

FCPO- The Beginning Of Selling Spree

With good news that comes to end soon, rumors on stockpiles spike on palm oil inventories on third quarter will serve as the main headlines for the price to move. To make things worse, the USDA report on Soy inventories that likely to double before the 2014 harvest will bring big Selling pressure soon. There is no stopping for the Bears to push the price down after they have assume control again on previous Friday when the Sept contract went down lower with new monthly lows. On previosu Friday, the September contract retreated 1.3 percent to end the morning session at 2,341 ringgit. That’s the lowest level for most-active futures since July 2. Prices are down 1.8 percent this week. Meanwhilre. Soybean reserves in the U.S., the biggest shipper, will more than double from this year’s projection after farmers planted record acreage and rain boosted yields following last year’s drought-damaged harvest, the Department of Agriculture said in a report on previous Thursday. Reserves on Aug. 31, 2014, will total 295 million bushels (8 million tons) from 125 million bushels, according to the report. Output will jump 13 percent to an all-time high of 3.42 billion bushels, according to USDA. Technically, the Sept contract continue to make new lower lows and lower high last week even before the Sell-down occur, signalling that the short term Bearish price action remain the same. No sign of market recovery yet as yesterday Sell-down was just a beginning stage for the price to fall further. For today, pivot support for the Sept contract is located around 2,254 while resistance is pegged at 2,340.

Daily Pivot Point
R2=2380
R1=2340
S1=2277
S2=2254
 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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