ZLBT Chats

Friday, January 15, 2010

Crude Palm Oil Tracking Soybean Oil; Rebound Off Low

Excess stockpile fear continued to grip the CPO futures market, sending the bulls cutting-losses on intermittent upticks. The MARCH delivery contract added RM20 on last minute buying. Closing at RM2’530/MT.

The benchmark MARCH contract attempted a weak rebound at the opening on borrowed strength from the overnight Soyoil’s positive closing. The overhead resistance area at RM2’544/MT has proven to be a “tough-nut-to-crack” for now. And this was viewed as an excellent opportunity for the ambitious bears to re-establish fresh SHORT positions. And failure to overcome this tough upside barrier will be disastrous to the hopeful bulls. As this will set-up a potential price slippage towards re-testing the recent pivot–low at RM2’480/MT. Any successful breach below this will set the fresh bearish path which will guide the market back down towards probing the RM2’377/MT area
Buy on resistance breakout

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