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10/29/2014
Reading the Lines:
Palm Oil Technical
Price Outlook
2014/2015
Presented by:
Benny Lee
[email protected]
READING THE LINES – PALM OIL PRICE OUTLOOK
CONTENTS:
1.
Short term analysis of crude palm oil futures price
Trend Analysis
Support and resistance levels
Chart pattern analysis
1
4
6
2.
Chart pattern analysis
8
3.
Cycle Analysis
4.
Price average analyisis
11
5.
Other crucial factor affecting price of FCPO
Malaysia palm oil demand and supply
Soybean Oil
US Dollar against Malaysian Ringgit
13
14
15
Conclusion and forecast
17
6.
9
Disclaimer
The presenter/author will not be responsible for any losses or loss profits resulting from investment decisions based in the use of the
information contained in this printed material, or otherwise.
This course / printed material is intended to provide accurate and authoritative information with regard to the subject matter covered. It is
taught or distributed with the understanding that the author is NOT engaged in rendering any investment or other professional advice. If
investment or other professional advice is required, the services of a competent professional person should be sought.
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READING THE LINES – PALM OIL PRICE OUTLOOK
RE-CAP: My price forecast for palm oil in February 2014 in
MPOC’s POINTERS. (FCPO price was at RM2,600)
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READING THE LINES – PALM OIL PRICE OUTLOOK
1. Short term analysis of crude palm oil futures price
Trend Analysis:
FCPO Daily
1. Long term trend bearish sine April 2014
2. Short term trend bullish since September 2014
30-day moving average
60-day moving average
90-day moving average
200-day moving average
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1. Short term analysis of crude palm oil futures price
Trend Analysis:
FCPO Daily
1. Price is in a technical rebound of a down trend
2. Down trend line
being tested
Mid-term down trend line
Short term
up trend line
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READING THE LINES – PALM OIL PRICE OUTLOOK
1. Short term analysis of crude palm oil futures price
Support and Resistance:
FCPO Daily
Resistance 3: RM2,550
Resistance 2: RM2,400
Resistance 1: RM2,222
Support 1: RM2,100
Support 2: RM1,900
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READING THE LINES – PALM OIL PRICE OUTLOOK
1. Short term analysis of crude palm oil futures price
Support and Resistance:
FCPO Daily
Bullish momentum
Bullish momentum
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READING THE LINES – PALM OIL PRICE OUTLOOK
1. Short term analysis of crude palm oil futures price
Trend Analysis from previous pages:
1. Trend remained bearish in the mid and long term
2. Trend is bullish in the short term
3. Momentum of the bullish trend is strong
4. Immediate resistance is at RM2,222. Next resistance levels at RM2,400 and
RM2,550
5. Immediate support is at RM2,100. Next support level at RM1,900
With the current momentum of the short term trend, there
is a high possibility for the price to test and break above
the resistance level at RM2,222.
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READING THE LINES – PALM OIL PRICE OUTLOOK
2. Chart Pattern Analysis
FCPO Weekly
Mid term - Down trend channel
Resistance
Support
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READING THE LINES – PALM OIL PRICE OUTLOOK
2. Chart Pattern Analysis
FCPO Monthly
Long term trend lines
Resistance
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2. Chart Pattern Analysis
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READING THE LINES – PALM OIL PRICE OUTLOOK
3. Cycle Analysis
Feb
Feb
June
Apr
Mar
May
Mar
Mar/Apr
Oct
Jul
Dec
Oct
Jul
Aug
Oct
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READING THE LINES – PALM OIL PRICE OUTLOOK
Chart Pattern and Cycle Analysis
Pattern Analysis from previous pages:
1. Mid term trend lines shows that price towards RM2,600
2. Long term trend lines indicates there is a potential for price to climb to RM2,900
3. Price correction analysis indicates that there is low chance of price breaking the
previous pivot high at RM2,900.
4. Price likely to peak in Mar – April 2015
Price likely going to climb towards the short and mid term resistance
levels between RM2,550 and RM2,600
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READING THE LINES – PALM OIL PRICE OUTLOOK
4. Price Average Analysis
2010 average:
RM2,740
2011 average:
RM3,220
2012 average:
RM2,950
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2012 average:
RM2,420
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4. Price Average Analysis
2014 Average – RM2,380
2015 Average – RM2,500
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READING THE LINES – PALM OIL PRICE OUTLOOK
5. Factors affecting palm oil prices – Demand & Supply (Malaysia)
Production
Export
FCPO
Stock
Stock expected to decline marginally in the next quarter
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5. Factors affecting palm oil prices – Soybean Oil
Soy oil Futures
FCPO
Spread with soy oil is at low levels
Spread - Soy oil and FCPO
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READING THE LINES – PALM OIL PRICE OUTLOOK
5. Factors affecting palm oil prices – US Dollar
1. USD correlation is more negative
when the spread between the price of
soyoil and palm oil is wide
2. USD correlation is more positive
when the spread between the price of
soyoil and palm oil is narrow
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5. Factors affecting palm oil prices – Analysis
1. Exports normally peaks in October, therefore expect lower exports
2. Production is set to decline
3. Inventories set to decline, but marginal.
4. The implementation of B7 biodiesel may help lower inventories.
5. FCPO prices may be supported by stronger US Dollar
6. US Dollar is expected to grow stronger in the next one quarter as QE measures
expected to be fully removed
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READING THE LINES – PALM OIL PRICE OUTLOOK
6. Summary and conclusion
1.
The last quarter and first quarter of the year are historically bullish for FCPO
2.
Short term trend indicates strong bullish momentum and hence the bullish trend
has begun.
3.
Fundamentally, the bullish trend may be supported by stronger US Dollar and
implementation of B7 bio-diesel program.
4.
The bullish trend expected to find resistance at RM2,550 to RM2,600 in the next
two quarters.
5.
The price is expected to average at 2,380 this year and RM2,500 for year 2015.
6.
Forecast is valid as long as price stays above RM2,000
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THANK
YOU!
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www.i2matrix.com
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