Friday, September 13, 2013

FCPO Heading Down Due To Active Productions 13th Sept 2013

Friday, 13th Sept 2013. Palm oil futures is likely suffering from heavy productions cycle currently as price continue to retrace gradually this week. Other news to follow.

"- U.S. stocks declined on Thursday, with the S&P 500 snapping its seven-session winning streak, as investors worried about developments related to Syria and Federal Reserve policy moves. The Dow Jones Industrial Average DJIA -0.17% dropped 25.96 points, or 0.2%, to 15,300.64. J.P. Morgan Chase & Co. JPM -1.92%  fell 1.9%, making the bank the biggest decliner in the Dow."

"-Asian markets were mostly higher on Thursday with Sydney hitting a fresh five-year intraday high, though a stronger yen weighed on Tokyo shares. With a positive lead from the U.S., Asia was able to move slightly higher despite the absence of major trading cues. Stocks were moderating after strong gains earlier in the week brought about by further signs of a Chinese economic recovery and reduced expectations of a military intervention in Syria. Chinese companies listed in Hong Kong managed to add to their gains, with the Shanghai Composite CN:SHCOMP +0.64%  ending up 0.6%. Chinese stocks in Hong Kong took pause, with the Hang Seng Index HK:HSI +0.07%  up less than 0.1%. Elsewhere in the region, South Korea’s Kospi KR:SEU -0.20%  was flat at 2,004.06 and Singapore’s Straits Times Index SG:STI +0.42%  was last up 0.4%. More generally, markets were looking ahead to next week, when the U.S. Federal Reserve will hold its policy meeting, which some expect will result in the central bank reducing the scale of its bond-buying program."
"- Crude futures posted modest gains on Thursday as the International Energy Agency issued an upbeat forecast for global oil demand next year. Crude oil for October delivery CLV3 -0.0092%  rose $1.04, or 1%, to settle at $108.60 a barrel on the New York Mercantile Exchange."
"-November Soybeans finished up 37 3/4 at 1396, 2 3/4 off the high and 54 3/4 up from the low. January Soybeans closed up 35 1/2 at 1393 1/2. This was 52 3/4 up from the low and 2 1/2 off the high. December Soymeal closed up 19.2 at 447.2. This was 26.6 up from the low and 0.8 off the high. December Soybean Oil finished up 0.07 at 43.03, 0.27 off the high and 0.43 up from the low.
The USDA report was considered supportive against trade expectations and November soybeans traded up to their highest level since September 3rd on heavy volume. New crop spreads posted double digit gains and extended their inverses which helped add momentum to the upside. The USDA pegged the 2013/14 ending stocks at just 150 million bushels as compared with the August estimate of 220 million and from trade estimates near 165 million. Planted acreage held steady at 77.2 million acres and the national average yield was pegged at just 41.2 bushels per acre vs. 42.6 in August. As a result, total 2013/14 production fell to 3.149 billion bushels as compared with 3.255 last month. The 2012/13 carryout came in unchanged from last month at 125 million bushels. Total usage was pegged at 3.14 billion bushels, down 36 million from last month but still up 41 million bushels from last year. World ending stocks for 2013/14 were estimated at 71.5 million tonnes as compared to 72.27 million tonnes in August. China import demand was left at 69 million tonnes as compared with 59.5 million for the 2012/13 season. Brazilian production came in at a record 88 million tonnes for 2013/14. This is up 3 million tonnes from last month and up from 82 million this past year. Net weekly export sales came in at 478,100 tonnes for the 2013/14 marketing year and as of September 5th, cumulative sales stand at 58% of the USDA forecast versus a 5 year average of 43%. Sales of 305,000 tonnes are needed each week to reach the USDA forecast. Net meal sales came in at 17,000 tonnes for the current marketing year and 111,700 for the next marketing year for a total of 128,700. Net oil sales came in at 1,700 tonnes for the current marketing year and 4,500 for the next marketing year for a total of 6,200. Cumulative sales stand at 94% of the USDA forecast for 2012/2013 versus a 5 year average of 93.7%. The threat of another year of extreme tightness "if" yield estimates continue to slide into the October report could support further contra-seasonal moves higher."

FCPO- Heavy Pressure From External Production Cycle. 

It is no rocket scientist to figure out why does the futures price of certain instrument went up or down, there always a reason or two to relate when the market move. Trader or analyst can write any reason behind a rally or a correction but no one is certain for sure that market really moved because of that reason. In fact, there is no need to find what is the real reason for the market to move that direction because trading is not figuring out who win the debate nor it depend who is better on finding the accurate reason behind a certain move. In technical perspective, trading is mainly about taking advantage of the price behavior or when it move to certain level. It may sound simple but most of the majority traders like to think otherwise. Complexity of any trading method will bring down any trading account to ground zero and it has become a fact. Back to technical outlook for the benchmark Nov, market is now still trap on Bearish price action likely for today and for the upcoming week. Traders are advise not to hold any fresh new positions overnight as Bursa will be close on 16th Sept 2013 for Malaysia day holiday. Recent lower high and lower low formed on hourly chart gave out a warning for an impending weakness if the Nov contract continue to fall below 2,320 today. Further technical rally for today is possible if the Nov contract manage to recover above yesterday high at 2,355 followed by previous Wednesday 2,367 level. Based on short term resistance, intraday traders can opt to Short around 2,355 and place just 2-3 points stop loss above that level for some low risk entry.

Daily Pivot Point
R2= 2373
R1= 2358
S1= 2325
S2= 2307
 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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