FCPO


Malaysian crude palm oil futures slipped on Tuesday as weak exports signalled consumers might have stocked up well ahead of the Muslim holy month of Ramadan although losses were capped by dry U.S. weather potentially hurting soy output. (Reuters)


However, palm oil is likely to advance in coming weeks because "the heat and drought in the U.S. Midwest aren't going away," an oilseed analyst in Germany said. Furthermore, as the probability of El Nino has increased based on the drop in the Southern Oscillation Index to minus 11.8 per cent recently, a drought in South-East Asia is very likely.  This could be the initial catalyst for the commodity's price rally. Moreover, the Malaysian Palm Oil Board (MPOB) released data yesterday showing a 4.9 per cent drop in stocks from 1.785 million tonnes in May to 1.699 million tonnes in June.


FCPO September opened at 3,141 and dropped to the day's low of 3,080. You can look for opportunity to buy at Support and sell at Resistance.