Tuesday, December 2, 2014

FCPO: Recovery Inbound 2nd Dec 2014

Tuesday, 2nd Dec 2014. Palm oil futures is breaching below few support level and went down below the congestion area as well, but recent oversold reading may bring swift recovery. Other news to follow.

"- U.S. stocks fell on Monday as disappointing economic data from China and Europe triggered a bout of selling in global equity markets. Weak Black Friday sales were also weighing on markets, especially on retailer stocks. The Nasdaq Composite saw its steepest drop in seven weeks, dragged down by big declines in tech giants such as Apple, Inc., Google Inc., Facebook Inc., and Alibaba. Energy and utility stocks were the only bright spots on Wall Street, rising in tandem with a spike in oil prices. The S&P 500 SPX, -0.68% closed 14.12 points, or 0.7%, lower at 2,053.44, its biggest one-day decline in more than 5 weeks. The Dow Jones Industrial Average DJIA, -0.29% shed 51.31 points, or 0.3%, to 17,776.93. The Nasdaq Composite COMP, -1.34% suffered its steepest drop in seven weeks, after dropping 64.28 points, or 1.3% to 4,727.35."

"-Falling oil prices and a worse-than-expected slowdown in Chinese manufacturing activity sent stocks sharply lower in Hong Kong and Australia on Monday, while Japan provided a haven for the region’s investors. Oil extended its fall to below $65 a barrel following a surprise move Thursday by the world’s biggest oil producing nations to maintain their production target levels, meaning a glut in the market is likely to remain. Analysts predict prices could fall as low as $60 a barrel in the near term. On the New York Mercantile Exchange, light, sweet crude futures for delivery in January CLF5, -0.59%   traded as low as $64.10 a barrel on Monday, down $2.05 from late Friday in New York. They slid 17.9% in November. The drop had many of the region’s markets deepening losses into the close. Australia’s S&P ASX 200 XJO, +0.96%   benchmark index closed down 2% at 5207.70, as a gauge of its energy stocks fell 6.4%. The Hang Seng Index HSI, +0.11%   lost 2.6% to 23367.45. An index of Hong Kong-listed China shares slumped 2.9%, marking the biggest one day fall since February."

FCPO- It Is Not Hammer Time Yet, Recovery May Come First

Palm oil futures for Feb contract may recover today judging from healthy recovery from Soy oil, crude oil and some pull back on Dollar value overnight. If that three did not serve a good reason for some recovery in FCPO futures, I do not know what would. Bad news for those who just Shorted yesterday, it would be a short live Sell position if the market recovered more than 1% today. Personally, I am not a big fan of averaging up for Sell / Short positions but this condition may call for some exception. Traders need to pay close attention to averaging up or down with a losing position and know where is the next stop losses. Usually it would be a tight stop loss after the trader choose to go on averaging their position. Sometimes averaging up or down may save your losing position into a break even or slightly better outcome but it must be treated with extreme prejudice. Stick to your secondary stop loss if you are averaging down, always. Back to the outlook, FCPO Feb is likely running on Bearish trend judging on the price action. Lower highs and lower lows are obvious candle formation formed in hourly chart since last two weeks. But there is no surprise if the market would recover 4% to 5% from this week. You can call it whatever you want, dead cat bounce or just some temporary rebound, I am out if my stop losses hit, no question about that. Stop losses is there for a reason and trader should execute what they have planned for, not second guessing it again and again. For today, pivot support is located around 2,084 while resistance is pegged at 2,154.

Daily Pivot Point
R2= 2154
R1= 2131
S1= 2084
S2= 2060
 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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