Thursday, October 24, 2013

Palm Oil Positive Momentum Continues 24th Oct 2013

Thursday, 24th Oct 2013. Palm oil futures is again set for another controversial rally soon as Soy oil did not manage to breach its previous five weeks high at 2,385. Other news to follow.

"- U.S. stocks closed lower on Wednesday, with the S&P 500 falling from a record, as investors assessed mixed results from U.S. corporations, including a disappointment from equipment-maker Caterpillar Inc. The Dow Jones Industrial Average DJIA -0.35%  declined 54.33 points, or 0.4%, to close at 15,413.33, with 21 of its 30 components in negative terrain. The S&P 500 index SPX -0.47%  fell 8.29 points, or 0.5%, to close at 1,746.38, with energy the worst performing and consumer staples faring the best of the 10 major industry sectors. The Nasdaq Composite Index COMP -0.57%  fell 22.49 points, or 0.6%, to close at 3,907.07. "

"-Chinese stocks fell in early Thursday action ahead of closely watched manufacturing data, with bank shares extending losses amid concerns over the health of major mainland China lenders. Hong Kong's Hang Seng IndexHK:HSI -0.11% lost 0.8% to 22,828.57, with the Hang Seng China Enterprises Index off 1%, while the Shanghai Composite CN:SHCOMP -0.20% dropped 0.5%. Coming a day after reports of climbing bad loans at the largest mainland Chinese banks, the People's Bank of China declined to add liquidity to the financial system Thursday."
"- Oil futures closed lower on Wednesday for a second consecutive session after U.S. government data showed that crude inventories rose more than expected, for a fifth week in a row. Crude oil for December delivery CLZ3 +0.39% dropped $1.44, or 1.5%, to settle at $96.86 a barrel on the New York Mercantile Exchange. "
"-November Soybeans finished up 7 3/4 at 1310, 8 3/4 off the high and 13 1/4 up from the low. January Soybeans closed up 6 1/2 at 1304. This was 11 3/4 up from the low and 8 3/4 off the high.
December Soymeal closed up 5.3 at 421.4. This was 8.0 up from the low and 4.2 off the high. December Soybean Oil finished down 0.02 at 41.5, 0.25 off the high and 0.25 up from the low. November soybeans closed 7 3/4 cents higher on the session but down 8 3/4 cents from the mid-session highs. The early rally pushed the market up to the highest level since September 27th. Solid gains in the wheat market and continued signs of strong demand for US soybeans helped to support the market. Private exporters reported a sale of 120,000 tonnes of US soybeans to Russia. The rally is seen as impressive given news of lower soybean futures in China overnight, weakness in Asia stock markets and continued bearish weather outlook for the US harvest and South America plantings. Meal was closed moderately higher on the session but also well off of the highs with talk of continued strong demand. December oil closed slightly lower on the day."

FCPO- Still Got Some Juice To Go

Before we go on commenting commodities futures for palm oil, the equity index and equity futures is doing quite well responding to external positive development. Most of the regional market are set to rally even further with various earning results from major companies in the states and temporary stability after the U.S government passes their debt ceiling and open their government for business. For local development, we will have Najib Razak prime minister to address Malaysia 2014 budget resolution. Back to palm oil futures, the benchmark Jan is set to continue its rally this week judging on steady formation of higher highs and higher lows so far. In addition, breaking up above its previous five weeks high at 2,485 would not be a problem at all if Soy oil continue to recover this week. But that is not the case as for today, Soy oil retrace back to settle at 41.37 cents per pound as the time of writing, 9.30am 24th Oct 2013. We should see lower opening for the palm oil futures and perhaps some mild retracement too. Palm oil futures may also run into technical sell-off as it hit major resistance level yesterday based on previous five weeks high at 2,485. Fortunately, overall technical and fundamental outlook remain positive on medium term time frame, at least for this month. For today, pivot point support is located around 2,450 while resistance is pegged at 2,516.

Daily Pivot Point
R2= 2516
R1= 2499
S1= 2450
S2= 2418
 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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