CPO Down On Rising Inventories & Falling Export
The benchmark November contract on the Bursa Malaysia Derivatives exchange settled MYR32 lower at MYR2,646 a metric ton, after tumbling to MYR2,637/ton, its lowest level since Aug. 6.Palm prices had previously rallied with support from strength in soy futures and ongoing concerns about disruption of harvests by heavier-than-expected rainfall in Malaysia, the second-largest palm producer in the world after Indonesia.
But forecasts of scant rain in the next 10 days in the key oil palm state of Sabah by the Malaysian Meteorological Department and a weaker ringgit took the bullish tone off the palm market, which rose to a 15-month high at MYR2,737/ton last week.
"The market has priced in the weather-risk premium and may trade around the MYR2,600-MYR2,650/ton range in the near term," said a senior trading executive in Kuala Lumpur. CPO Recommendation
Buy at Support as shown in chart above
A better entry would be during forced selling or profit takings (flurry)
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