BMD Crude Palm Oil Futures >>> Outlook 14 July 2011

CPO Inventory To Cap Prices 
It was clear that CPO bulls were in charge the whole session yesterday. For this week, the technical reading on the chart have been tricky when the market dips due to overwhelming stocks concern (on Tuesday) after the benchmark Sept was anticipated to recover after it hit above 3,100 level past week. To many surprises, the benchmark Sept manage to reach an important resistance level to observe. 


Bottom line, market is going to move extensively (either way) due to the record high open interest on palm oil market.

If the market kept on recovering extensively, more Short holder will be force to shed their positions big time, vice versa. It was interesting to see, Sellers steps in to accumulate or initiate new positions while Long holders cover their holding when the market rose up to 3,095 level yesterday. 


Nonetheless, for the market to sustain these positive momentum, it is (Sept contract) best for it close above the resistance trend line at least for a session.  For today, resistance is pegged at 3,100 while support is located around 3,059 level.

Daily Pivot Point

R2=3117

R1=3099

S1=3059

S2=3037

ZLBT Trade Strategy

Aggresive SHORT with stop @ close above 3120

Short Target 3050, 3020, 3000, 2985

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.