FCPO, FKLI Previews and Commentaries 14 May 2013

Fundamental
Palm oil prices tumbled on profit taking after having reached one-month high in early trading hours. Pressure also came as lower domestic inventories outweighed by high stock level at China and India which triggered concerns about limited palm oil demand from these major importers. NYMEX crude posted losses on third consecutive trading day on China’s oil demand which fell to 8-month low in April as industrial output expanded at slower pace than expectation.

Prices received additional pressure after robust US retail sales sent dollar higher as it would bring negative impact to commodity prices. Investor now await cue from API oil data due later today and EIA data on Wednesday. Despite the poor weekly soybean exports, US soyoil ended higher on strong cash market and spillover effect from short covering rally in corn.

Expect CPO futures to trade higher as palm oil trading at discount to other edible oils amid speculation over a possible drawdown in inventories in Indonesia, the world’s largest palm oil producer, to a 6-month low as consumption increased.

Overnight Leads

Soybean futures on the Chicago Board of Trade rose on Monday on firm cash markets and

tightening U.S. supplies, lifting the spot contract to a six-month high, traders said.

Technicals
Futures settled at 2310, down 9 points. A black candle was formed as prices opened higher but upward movement was not sustainable, as stronger sellers have taken control of the market for the day. However, prices remained position above 20 day moving averages and MACD on
its bullish journey, therefore bulls remain in firm on technical grounds. As such support and resistance can be pegged at 2300 and 2335 respectively.

Technical indicators:
 MACD= Positive, ADX= Neutral,

Intraday technical support & resistance for 14/05/2013:
 1st support 2,300; 2nd support 2,270
 1st resistance 2,335; 2nd resistance 2,380-2400

Strategy

Trade may long with a stop on or below 2270.

CPO Analysis For The Week Ahead 08 Apr 2013

CPO Technical Outlook

The benchmark June contract was consolidating this week and some trad­ers were cautious ahead of key fundamental reports and preferred to stay on the side-lines.

Last week’s palm oil price movement showed that the market was directionless while waiting for the fun­damental reports next week to gauge on the next price movement.

The benchmark level of RM2,360 will continue to be monitored to determine if the palm oil prices could be supported at this level.

Any price break below RM2,340 would attract more technical selling and long liquidation in the market.

Resistance would be pegged at RM2,430 while support will be set at RM2,340.

In addition, the increase worries on the bird flu outbreak in China also con­tributed the fall in soybean prices which could reduce the demand in feeds. 

Recommendations 

Sell Into Strength 

Top 20 Overbought Stocks 24 Dec 2012

*Note: The list below is the 20 most overbought of the 1000 over Bursa Malaysia listed stocks with 14-day RSI above 80. It is generally a bearish or SELL list, especially if the readings approach 90.

 

Caveat: The list consists of fundamentally sound stocks, and hence are long-term BUY or HOLD stocks.

DISCLAIMER

The information contained herein was obtained from sources believed to be reliable. However, we do not guarantee the accuracy and completeness of the report. Opinions expressed herein are subject to change without notice. This report is for information purposes only and should not be construed as an invitation, offer or solicitation to purchase or sell any futures product referred to herein. The Author may from time to time has an interest or position in the futures products or stocks mentioned. There is a risk of loss in trading stocks,futures & derivatives like products.

 

GOODLUCK

December Soybean Oil Chart c/w Technical Recommendations 11092012

ZLZ12 Technical Analysis Daily Chart

ZLZ12 Technical Table

 

HAPPY TRADING

ZLBT Random Stock Pick >>> MAA Group Berhad (1198)

TIME FOR REBOUND

MAA Selldown Fades

It's been almost a year when words were out on the streets that Malaysian Assurance Allianz MAA) was to be taken over and renamed Zurich Insurance (M) Bhd. Local investors immediately began to sell-off MAA equities for whatever reasons. MAA dropped from 56 sen to 38 sen >>> a 30% ++ discrepancy is certainly illogical as it's fundamentals remain strong.

However, over the recent week, a price rebound seems to indicate the bears are running low on ammunitions. Below herewith MAA (1198) Weekly Technical Chart c/w Fundamental Infos ......

Check out MAA fundamentals from other sources and find me a 45 sen stock with such profits, PE below 2, EPS 42.95 c/w NTA 1.37 and ZL will buy that stock before you can yawn.

No doubts MAA's TA is not as pretty as it's FA becoz you'll have a hard time finding any penny stocks valued 50 sen & below with it's TA & FA better than MAA's.

ZLBT recommend a BUY ON DIP for this gem.

 

HAPPY TRADING & GOODLUCK

FCPO Daily >>> Fundamental / Technical Views 05 Apr 2012

Fundamental
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.

Technicals
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.

Overnight Leads
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.

CPO Futures Preview 15 Feb 2012

Fundamental
Palm oil prices rose on Tuesday, on the back of the rally in US soybeans as investors worried about the adverse weather conditions in South America affecting crop yields. In addition, the weakening of the Ringgit against the dollar spurred demand for the tropical oil. 

Overnight crude oil fell, tracking weaker retail sales figures in the US, as well as fresh concerns on Europe over a potential downgrade of its triple-A ratings for France, Britain and Austria. On the other hand, US soyoil rose to a near four-month high yesterday, due to production concerns in Brazil and signs of fresh US export demand. Expect futures to trade range bound with upwards bias today as lingering European issues may counter the adverse weather conditions in South America.

Overnight Leads
US soybean futures end mostly higher, with old crop contracts rallying to nearly four-month highs.
Soybean futures rose for the third consecutive trading day, fueled by worries about hot, dry
conditions in southern Brazil leading to lower crop yields, analysts say.

Technicals
Futures closed at 3205.0, up 2.36 percent. Futures managed to settle above psychological level of 3200 depicted by a long white candle as strong buying interest seen throughout the day. A sustained break above this level would likely see futures head towards testing 3240. The MACD reaffirmed the bullish outlook as it crossed its 8-day moving average on a bullish divergence. As such, support and resistance can be pegged at 3185 and 3240 respectively.

Strategy : Aggressive trade may long with a stop on below 3185.

HAPPY TRADING 

CPO Fundamental + Technical Midday Outlook

Fundamental
Palm oil settled higher yesterday on encouraging June 1 - 15 days export data and expectation for export to further improve towards Ramadan festive month. Nevertheless, gains were capped by lingering concerns over escalating production and inventories coupled with uncertainties in external markets. Overnight crude oil slumped to settle at the lowest since February as European debt crisis and worse than expected manufacturing data in US outweighed falling crude stocks to pressure prices lower. Soy oil however managed to end higher in tandem with soybeans with investors shifting focus back to uncertainties in soy planting session. Expect futures to trade under pressure today along with weakness in external markets while investors likely to stay sideline in the absence of fresh supportive factors.

Technicals
Futures continued the rebound from its one month low and traded higher to form the second higher high, higher low long white candle. Diverging MACD still persist and likely to keep sellers safeguard the resistance of 3335. Technically, look for futures to trade range bound with support and resistance pegged at 3235 and 3335 respectively.


ZLBT Trade Strategy
Aggressive trade may short with stop on close above 3360

CPO Preview 14 June 2011

Fundamental
Palm oil settled a choppy session higher on Monday, snapping five days of losses as investors deemed the 5.3% drop last week was overdone. Soy oil ended lower in tandem with soybeans with investors reduced long positions in absence of fresh supportive leads.
However, CPO trading today could be buoyed by improving export expectation and investors’ bargain hunting ahead of Ramadan month after previous week’s sell off.

Technicals
After five consecutive losing streaks, futures staged a technical rebound after hit intraday low of 3199 and settled in long white candle. Futures likely to test the immediate resistance of 3290, coincidently its Friday’s high and 50 days moving average. Bearish divergence in MACD deemed to keep sellers active. Support and resistance pegged at 3220 and 3300 respectively.

ZLBT Trading Strategy

Aggressive trade may short with stop on close above 3360.

HAPPY TRADING & GOODLUCK2ALL

How is technical analysis different from fundamental analysis?

While fundamental analysis may tell you when you’ve found a solid company, its weakness is getting you into that stock on a timely basis as far as when to enter and exit the stock. This is where technical analysis comes in. Its great asset is that it’s a better timing tool. So the fundamentals tell you “what” to buy and technical analysis tells you “when” it might be a higher probable time to buy and sell that stock. As you can see from this, they both can be complimentary to one another. After all, if you can trade a stock with horrible earnings or a stock with favorable earnings projections, of course you should trade the one that’s more fundamentally sound. Someone who strictly uses fundamental analysis may need to hold on to that stock for 3-10 years for the true valuations to be reflected in the stock. These tend to be long term investors. The trader, on the other hand, tends to lean more heavily on technical analysis because the trader has to be right within hours to weeks, not 3 to 10 years. To the technician, timing is of the essence.

What is Technical Analysis?

A method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume. Technical analysts do not attempt to measure a security's intrinsic value, but instead use charts and other tools to identify patterns that can suggest future.

Technical analysts believe that the historical performance of stocks and markets are indications of future performance.

In a shopping mall, a fundamental analyst would go to each store, study the product that was being sold, and then decide whether to buy it or not. By contrast, a technical analyst would sit on a bench in the mall and watch people go into the stores. Disregarding the intrinsic value of the products in the store, his or her decision would be based on the patterns or activity of people going into each store.

What is Fundamental Analysis?

A method of evaluating a security by attempting to measure its intrinsic value by examining related economic, financial and other qualitative and quantitative factors. Fundamental analysts attempt to study everything that can affect the security's value, including macroeconomic factors (like the overall economy and industry conditions) and individually specific factors (like the financial condition and management of companies).

The end goal of performing fundamental analysis is to produce a value that an investor can compare with the security's current price in hopes of figuring out what sort of position to take with that security (underpriced = buy, overpriced = sell or short).

This method of security analysis is considered to be the opposite of technical analysis.

Fundamental analysis is about using real data to evaluate a security's value. Although most analysts use fundamental analysis to value stocks, this method of valuation can be used for just about any type of security.

For example, an investor can perform fundamental analysis on a bond's value by looking at economic factors, such as interest rates and the overall state of the economy, and information about the bond issuer, such as potential changes in credit ratings. For assessing stocks, this method uses revenues, earnings, future growth, return on equity, profit margins and other data to determine a company's underlying value and potential for future growth. In terms of stocks, fundamental analysis focuses on the financial statements of a the company being evaluated.

One of the most famous and successful users of fundamental analysis is the Oracle of Omaha, Warren Buffett, who has been well known for successfully employing fundamental analysis to pick securities. His abilities have turned him into a billionaire.