Tuesday, December 24, 2013

FCPO: When Fundamental Become Funny Mental

Tuesday, 24th Dec 2013. Palm oil futures went up on yesterday session after it open lower due to weak Soy oil closing. Market quickly regain positive momentum right after the opening bell and continue to head up straight. What would trigger this kind of frantic rally  ? Other news to follow.

"-U.S. stock indexes extended their record run, with the S&P 500 SPX +0.53% and the Dow Jones Industrial Average DJIA +0.45% closing at all-time highs while the Nasdaq CompositeCOMP +1.08% ended at its highest level since September 2000. The S&P 500 rose 9.67 points, or 0.5%, to finish at 1,827.99, while the Dow advanced 73.47 points to 16,294.61. The Nasdaq Composite jumped 44.16 points to 4,148.90. "

"-Chinese stocks gained for the first time Monday in 10 trading sessions, indicating improving confidence among investors concerned that a spike in interbank lending rates last week could gum up the country’s financial system.

The Shanghai Composite CN:SHCOMP +0.24%  fell as much as 0.6% shortly after the open but recovered to close 0.2% higher for the day, as investors started to come to terms with stubbornly high interest rates that banks charge each other for short-term loans."
"- Gold futures remained under pressure Monday, finishing below $1,200 an ounce and trampling gold bugs’ hopes for a happy ending to a brutal year. Gold for February delivery GCG4 -0.02% declined $6.70, or 0.6%, to $1,197 an ounce, while March silver SIH4 -0.25%  lost 4 cents, or 0.2%, to close at $19.41 an ounce."

FCPO- I Kid You Not.

Any trader can guess palm oil demand, production and stockpiles are heading to negative sentiment with least amount of possibility for the palm oil futures to rally above weekly high yesterday. Furthermore, Soya oil was no where staying at high price as it was trading far below 39.60 cents per pound during Asian trading session. So, why does palm oil futures able to recover above most expectation. Ohh, I get it, most of us was wrong most of the time anyway, winners in the market were made from the minority. It make perfect sense when the masses are wrong, market would move freely against those masses. It is futile to find out why, what and where price has rally or tumble, leave it to the analyst to figure that out. Your job as a trader, was to re-act, period. Price went up and hit your criteria or entry point, go Long. Easier said than done, most of our mindset are trapped with bias thoughts, especially fundamental to start off. Price would not rally that far if the fundamental is weak or negative. Well, that does not apply on yesterday session, and more session to come when the market defy what has the news or fundamental data has drawn. The simplest way to overcome this set back, was to detach yourself and focus just only with price and time. Price will be your ultimate objective to measure your entry, risk and reward, while time is crucial to set your timing in the market such as when to "get out." Technically, yesterday positive rally, force the market to record a positive outlook on medium time frame chart. It was a Bullish break out when the benchmark March pierce above 2,605 level, marking a new high since 12th Dec 2013 after the market went into correction phase last week. For today, pivot support for the March contract is located around 2,585 while resistance is pegged at 2,652.

Daily Pivot Point
R2= 2652
R1= 2634
S1= 2585
S2= 2554
 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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2 comments:

  1. LIKE ur post... santa rally going strong on cpo

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  2. It can't be a better place to read and improve knowledge about commodity or then your blog. It was a pleasant time which i spent on your blog. thanks for sharing such a valuable information with us. Hope to visit your blog again and read even more interesting articles from you Futures Trading in Soya Oil.

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