BMD Crude Palm Oil Futures (FCPO)

Crude Palm Oil (CPO) Ends Up In Volatile Trade; Likely Lower Output Supports
Crude palm oil futures on Malaysia’s derivatives exchange rose for the fourth consecutive day Friday as investors covered shorts ahead of next week’s output and export data, ignoring weak external leads.

The benchmark April CPO contract on the Bursa Malaysia Derivatives ended up MYR11, or 0.4%, at MYR2,521 a metric ton, close to an intraday high of MYR2,521/ton.

Most growers are expecting a double-digit percentage drop in Malaysia's output in January, which may continue to decline in February, said a Kuala Lumpur-based trader.

"February is a shorter month and the arrival of palm fruit bunches at the mills has been paltry so far," said a Malaysia-based exporter, adding this may ease the burden of domestic palm reserves, which rose to a 13-month high of 2.24 million tons in December.

The Malaysian Palm Oil Board will issue January output data on Wednesday. Production in December was estimated at 1.52 million tons, down 4.7% on month.

Until then, CPO futures will likely remain in consolidation, trading in a MYR2,480-MYR2,525/ton range, an analyst in Kuala Lumpur said.

Latest : Soybean Oil closed down 21 pts. at 37.00.
March soybean oil closed lower on Friday but remains above the 10-day moving average crossing at 36.66. The mid-range close sets the stage for a steady opening on Monday.

Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near-term. Closes above the 20-day moving average crossing at 37.36 are needed to confirm that a short-term low has been posted.

If March renews this winter's decline, the 87% retracement level of the September-January rally crossing at 35.02 is the next downside target.

First resistance is the 20-day moving average crossing at 37.36. Second resistance is Wednesday's high crossing at 37.53. First support is the 10-day moving average crossing at 36.66. Second support is Monday's low crossing at 35.80.