Palm oil prices touched its highest in 13-months on Wednesday, as speculation of a tightening soybean crop in the coming months continue to paint a bullish picture for the tropical oil.
Overnight crude oil fell by 2 percent, as a higher-than-expected increase in crude oil inventories and a stronger dollar weighed on prices. US soyoil rose, buoyed by concerns over reduction in soybean supplies in South America. Expect futures to trade range bound with a downwards bias on the back of dwindling global sentiment after the Fed announced the unlikelihood of monetary stimulus to prop up the economy in the future.
Futures settled at 3557, up 24 points. Futures trading was seen in the formation of a short-bodied white candle, indicating a bullish outlook as gains in the morning session remain consolidated throughout the day. Prices edged higher and the MACD continued on its bullish divergence journey. Technically speaking, indicators are showing bullishness in the market, however investors may be inclined to book profits after markets were spooked from the prospect of reduced liquidity in global markets.
Soybean futures market closed higher on Wednesday after back-and-forth session lifted by
concerns about shrinking crops in South America
As such, support and resistance can be pegged at 3500 and 3570.
Intraday Trading Strategy
Aggressive trader may short with a stop on or above 3574.