CPO market re-act positively to overnight Soya oil recovery which rose about 2% higher on Wednesday. Soya bean and oil were on the rising due to production concern on certain states.The USDA is showing tight grain stocks owing to rising biofuel use spurred concern over the prospect limited food supplies. The report shows that corn stocks have hovered near 15-year lows for longer than expected due the grain's use in making ethanol, lifting vegetable oils that are also used in other competing renewable fuels.
These events are likely to have positive spill over effect to palm oil prices as it tend to track the prices of other vegetable oils as well. It seems that market totally ignore the record high supplies and bad export data announce on the 10th July.
Technically, the benchmark Sept has a small break out on the opening session but it was covered hours later that signifies solid Bullish expectation on palm oil prospect. The solid positive momentum on palm oil market is undeniable yesterday when the benchmark Sept manage to breached above previous high @ 3,138 level and closed RM62 higher 3,144 level, the highest since 30th June.
Daily Pivot Point
R2= 3168
R1= 3156
S1= 3120
S2= 3096
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.
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