FCPO: Palm Oil Demand In Concern

Wednesday, 25th May 2015. Palm oil futures made some significant recovery yesterday amid oversold reading since last Monday. Other news to follow.

"-U.S. stocks moved higher Tuesday, with the S&P 500 and Dow industrials closing at records, as the market read Federal Reserve Chairwoman Janet Yellen’s testimony before Congress as a reassurance that a rate hike might not occur until the second half of the year. The S&P 500 SPX, +0.28%  finished up by 5.82 points, or 0.3%, at 2,115.48, while the Dow Jones Industrial Average DJIA, +0.51% gained 92.35 points, or 0.5%, to end at 18,209.19. The Nasdaq Composite COMP, +0.14%  added 7.15 points, or 0.1%, to end at 4,968.12, leaving it just 1.6% off its March 2000 peak. The tech-heavy index advanced for the 10th session in a row, scoring its longest winning streak since mid-2009, when it rose for 12 straight days."

"-The U.S. crude-oil benchmark failed to hold on to initial gains Tuesday, losing ground for a fifth straight session as traders awaited the latest round of supply data. On the New York Mercantile Exchange, West Texas Intermediate crude futures for delivery in April CLJ5, +0.00% lost 17 cents, or 0.3%, to close at $49.28 a barrel. WTI’s losing streak is the longest since August. Brent crude for April delivery LCOJ5, +0.26%  on London’s ICE exchange also failed to hold on to initial gains, dropping 24 cents, or 0.4%, to close at $58.66 a barrel."

FCPO- Demand Have To Pick Up, Or Else.

Palm oil futures for May contract manage to recover up to 2,259 level from 2,216 yesterday. The recovery made happen in the afternoon session when Soy oil starting to climb from 31.33 cents per pound to 31.55 cents per pound before FCPO trading time came to stop at six o'clock sharp. It was a strong come back for the May contract as price kept on recovering ever since of the beginning of afternoon session. What drove these recovery might be oversold reading occur on Monday as panic Selling reign the condition of the market on last Monday, weaker than expected Soy oil also gave some push to the downside as well. First quarter will be a low season for production usually but this element would change on second quarter as production is likely pick up soon after that. Technically, May contract rebound was a first attempt to overturn the overall short term Bearish outlook back to sideways. Long term wise, it is still a Bullish market judging on daily chart. The rest of the recovery may have to depend on how well the Soy oil recover for the rest of the week. So far, Lower highs and lower lows have been formed on hourly chart and this signifies Bears can quickly gain control if other edible oil starting to decline. For today, pivot support for May contract is located around 2,229 while resistance is pegged at 2,287.

Daily Pivot Point
R2= 2287
R1= 2272
S1= 2229
S2= 2201
 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.