Swing: Bearish bias on CPO (26/03/19)
Updated
Palm oil is edible oil which is extracted from the pulp of fruit of oil palms. The color of pulp is red. That's why crude palm oil is naturally similar to pulp color because of high inactive vitamin A content. It is different from kernel oil or coconut oil. Commonly it is combined or mixed with coconut oil to make highly saturated vegetable fat, which is also used for cooking purposes.
Description: Main usage of CPO is for cooking purposes and is largely used in South-East Asia, West Africa and some parts of Brazil. Commercial kitchens use it due to its low cost. It's not healthy as its counterparts due to high content of saturated fats. Largest producer of CPO is Indonesia, Malaysia, Nigeria and Columbia. They are major exporters of palm oil. India is net importer of Crude Palm Oil and Mumbai being one of the major trading centers. It is also used for making bio diesel and one of it's by product is Glycerin.
The largest derivatives market for CPO is Bursa Malaysian Derivatives. It's also traded heavily on MCX and NCDEX in India wherein delivery center is Mumbai. Its prices are affected mainly by demand and supply cooking oils and oil seeds all over the world. It is measured in kilograms.
We are bearish on CPO due to the following reasons:
1) EMA 50 and 200 pointing down with suggest the short to mid-term trend is still towards the downside
2) Heavy volume on 27 Feb 2019 with candle ending as a bearish engulfing candle suggest sellers are present at this price zone
3) Prior support turned resistance at 2173 will prove to be a tough nut to crack
Trade Set-Up
EP: 2173
SL: 2282
TP: 2000
Kindly note that CPO is not as liquid as compared to other futures product. Ensure that you have done your own due diligence before executing the trade.
Disclaimer:
The material (whether or not it states any opinions) is for educational purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by Nour Capital or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Description: Main usage of CPO is for cooking purposes and is largely used in South-East Asia, West Africa and some parts of Brazil. Commercial kitchens use it due to its low cost. It's not healthy as its counterparts due to high content of saturated fats. Largest producer of CPO is Indonesia, Malaysia, Nigeria and Columbia. They are major exporters of palm oil. India is net importer of Crude Palm Oil and Mumbai being one of the major trading centers. It is also used for making bio diesel and one of it's by product is Glycerin.
The largest derivatives market for CPO is Bursa Malaysian Derivatives. It's also traded heavily on MCX and NCDEX in India wherein delivery center is Mumbai. Its prices are affected mainly by demand and supply cooking oils and oil seeds all over the world. It is measured in kilograms.
We are bearish on CPO due to the following reasons:
1) EMA 50 and 200 pointing down with suggest the short to mid-term trend is still towards the downside
2) Heavy volume on 27 Feb 2019 with candle ending as a bearish engulfing candle suggest sellers are present at this price zone
3) Prior support turned resistance at 2173 will prove to be a tough nut to crack
Trade Set-Up
EP: 2173
SL: 2282
TP: 2000
Kindly note that CPO is not as liquid as compared to other futures product. Ensure that you have done your own due diligence before executing the trade.
Disclaimer:
The material (whether or not it states any opinions) is for educational purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by Nour Capital or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
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