PALM OIL PRICE OUTLOOK – 2ND QUARTER, 2017

Dear  Associates & MTT Students,

The bearish first- Quarter of 2017 has come and gone and we look forward to massive price uncertainties for the rest of 2017.

Extreme bullish price actions were also seen during the 3rd & 4th Quarter of 2016 and traders who hedged and traded based strictly on fundamentals or took an academic approach to market analysis may not have completely benefited from the price cycles.

My Master Trader Tutorial students who took the Quantitative Algorithm high-frequency trading approach truly had a gala time hedging and trading during the last three-quarters.

Have a good look at the chart and look for the buy & sell signals given by the Quantitative Algorithm method over the last three-quarters.

The buy-signal is given when the red-line kicks above the blue-line and the sell-signal is triggered when the red-line drops below the blue-line. It is as simple as that!

With this consistent and excellent massive-strike rate approach, hedging or trading Palm Oil is like swimming with the current and not against it!

Eight weeks ago, the Quantitative Algorithm gave the sell-signal and that signal has lasted till today (please see chart).  Until the sell-signal changes to a buy-signal , we would maintain our bearish stance.

Quantitative Algorithm is actually artificial intelligence effectively at work. With this kind of trading-edge, you become the fly in the room! An insider-trader!

In trading, there are certain things that cannot be taught. You have to live it.

Trading or hedging palm oil is all about a decision-making process. Your odds are very low when you do not have an effective and consistent trading-edge.

Learn the Quantitative Algorithm Approach by attending the one-day Master Trader Tutorial conducted by me on 12th May, 2017 in Kuala Lumpur.

Register Now!-01

For registration, programme or further details please click on icons above. We can also be contacted at teohgm@gmail.com (Phone: +6012 268 8121), david@gbworks.com.my (Phone: +6012 204 8918)

CPO FUTURES PRICES- 3RD ACTIVE MONTH

CPO.png

Sincerely,

G.M.Teoh

PALM OIL PRICE FORECAST

Dear Friend & Associates, 

Our Quantitative Technical Algorithm Analysis was spot-on in predicting the Palm Oil Futures price trend for the last two weeks!

Despite minor price adjustments over that period, our technical approach managed to filter out the markets’ noise and correctly point the way of the main trend.

The Quantitative Technical Algorithm Analysis has very high and impressive strike-rate and for hedgers and traders, an understanding of its working and application is absolutely essential for trading success..

This form of cycle analysis is very suitable for crude palm oil, crude oil, forex and soya oil.

Any serious hedger or trader who desire to have a PERMENANT change on their trading this year should set themselves up for success by attending my signature program, the 1-day Palm Oil Master-Trader Tutorial (MTT) in Kuala Lumpur on 5th March 2016. (Before the KL POC 2016).

I’ve created a pretty extensive trading course that might help set you in the right direction.

Don’t just take my word for it. BE THERE and experience it for yourself.

Many palm traders from India, EU, US, China,Middle-East, Indonesia, Malaysia and Singapore have attended the MTT sessions and experience drastic changes in the way they look at the palm oil market and prospered.

For registration, programme or further details please click on icons above. We can also be contacted at  teohgm@gmail.com (phone: 012268 8121),   david@gbworks.com.my   (phone: 0122048918)

Sincerely,

G.M.Teoh

PRICE OUTLOOK FOR THE NEXT TWO WEEKS.

The Quantitative Algorithm Technical tool, the GMT Trend-Tracker has indicated as at yesterday’s close that the market is nearing its rally-tops and could enter into a price adjustment of correctional phase in the very near future.  

The GMT Trend-Tracker’s signal trigger-lines are in negative convergence as at yesterday’s close and indicated that the buy-signal that was given in mid-November has about reached it objectives. (please see chart).

In the event of a confirmation of the bearish trading signal, prices are expected to head south and test its immediate price-support around the RM2,500-RM2,450 levels in the near term. This is expected to be the new-normal trading range for in days ahead.

BMD CPO FUTURES – 3RD MONTH (WEEKLY)
GMT TREND-TRACKER – BUY & SELL SIGNALS.

Picture1CME SBO FUTURES –WEEKLY
GMT TREND-TRACKER – BUY & SELL SIGNALS

Picture2In our last report, we projected that CME SBO futures prices would rally based on the GMT Trend-Tracker trading signals. SBO prices has since moved higher and traded near its recent-highs at the US cent 32.50 cents.

The GMT T.T. remained in positive divergence and suggested that upward rally is still intact.

Technically, the prospects remains good for prices to move higher to re-test it most-recent highs at 32-33 cents before they enter into a downward adjustment.

NYMEX – LIGHT SWEET CRUDE –APRIL 2016

Picture3.png

The price of NYMEX Light Sweet Crude Oil remained in positive trend following the triggering of GMT Trend-Tracker buy-signal some six days ago. The May Crude Oil futures prices have an immediate upside-target at USD 36-38 per barrel.

 FOREX MYR/USD

Picture4The GMT Trend-Tracker buy-signal was triggered five days ago and stayed constructive during yesterday’s close.  Following its recent recovery, the MYR has once again weakened against the USD. Continuation of the bearish momentum would likely take the MYR back to 4.25-4.30 to the US dollar.

FOREX IDR

Picture5.pngAfter having reached its best levels five days ago, the Indonesian rupiah has turned weaker and ended yesterday in a slightly positive note. As at yesterday’s settlement, the GMT T.T. trading signal gave the sell-signal and indicated that the IDR would strengthen further against the USD.

M’SIAN CPO MONTHLY OUTPUT- STOCK – PRICE

Picture6The Malaysian CPO production for January 2016 has fallen sharply and this El Nino infected production pattern is now confirmed to extend into at least the early-part of the second-quarter of 2016.

Palm oil stocks are clearly in downward trend and CPO futures prices has managed to hold above the RM2,550 level in anticipation of further reduction in output and stocks. Ideas that the sluggish exports seen over the last two months would pick up remained a supportive factor.

I believe a simple, historically tested and proven, trading edge with well managed risk parameters is the foundation for consistent hedging and trading success.

Looking forward to seeing you at the 1-day Palm Oil Master-Trader Tutorial (MTT) in Kuala Lumpur on 5th March 2016. (Before the KL POC 2016).

Profitably Yours,

G.M.Teoh

MAKE 2016 YOUR BEST YEAR YET!

Dear Friend & Associates,

In 2016, the Palm Oil Price Forecast and Analysis Report would be on a bi-weekly basis.

Quantitative Technical Algorithm Analysis would be employed to track the market’s trends and understanding of its working is vital.

This year, many outside factors like crude oil prices, the strength of the US dollar; soya oil, the impact of the extended El Nino and the basic fundamentals of palm oil would continue to exert their  influence and impact on Palm Oil price.

I believe a simple, historically tested and proven trading edge with well managed risk parameters is the foundation for consistent trading and hedging success.

If you are serious & desire to have a PERMENANT change on your trading this year, set yourself up for success by attending my signature program, the 1-day Palm Oil Master-Trader Tutorial (MTT) in Kuala Lumpur on 5th March 2016. (Before the KL POC 2016).

You really have to have a method that has an edge. You have to have confidence in that method. I’ve created a pretty extensive trading course that might help set you in the right direction.

You will re-set your trading and hedging blueprint, right there, that day.

That’s what you’ll learn to do at the Palm Oil Master Trader Tutorial.

Don’t just take my word for it. BE THERE and experience it for yourself.

Many palm traders in Indonesia, Malaysia and Singapore have attended the MTT sessions and experience drastic changes in the way they look at the palm oil market and prospered.

For registration, programme or further details please click on icons above. We can also be contacted at  teohgm@gmail.com (phone: 0122688121)   david@gbworks.com.my   (phone: 0122048918)

Sincerely,

G.M.Teoh

 

LET US TAKE A LOOK

What does the Quantitative Algorithm Technical tool say about the price direction of crude palm oil? The GMT Trend-tracker’s buy-signal that was given in mid-November remained intact as at last Friday’s close and continue to call for more upside trading in the immediate term.(please see chart). Price upward breakout at the 2,400-2,450 levels indicates the market has entered into a new-normal trading level that could take prices higher to  the 2,500-2,550 levels.

BMD CPO FUTURES – 3RD MONTH (WEEKLY)
GMT TREND-TRACKER – BUY & SELL SIGNALS.

01.pngIt is very obvious that by looking at the trading signals in the chart that the GMT T.T. tracks only the activities of the big players not the small players.

This method simply divorced itself from the market noise and minor  price movements and focused on the reality of the market – the major trends. This is crucial for timing a trade or hedge and that is all that matters! Timing is everything.

CME SBO FUTURES –WEEKLY
GMT TREND-TRACKER – BUY & SELL SIGNALS

02.pngEvery day in the morning, every palm oil trader worth their salt would look at the CME SBO futures before making trading decisions. All cycles of SBO was successfully nailed by the GMT Trend-Tracker in 2015 till today. (see chart).

The trading signal based on the GMT T.T. was bullish as at last Friday’s close. Technically, the prospects of prices trending higher to re-test it most-recent highs at 32-33 cents is bright.

We may know all the fundamentals of soy oil and yet be wrong in trading. What matters in markets is the trend. Hedging and trading success can on be achieved by trading the direction and duration of a price move, by definition THE TREND.

NYMEX – LIGHT SWEET CRUDE – APRIL 2016
03.pngThe price of NYMEX Light Sweet Crude Oil rebounded today after hitting a 12-year low. Is this a dead-cat bounce or the light at the end of the dim tunnel? How would this recovery effect biodiesel. Goldman Sachs projection is now partially correct and what would be the influence on palm oil if their USD 25-20 per barrel call for 2016 becomes a reality.

Over the last sixteen months, the price trend of crude oil was successfully tracked by our GMT TT. They were simply spot-on!

As at Friday’s close the trading signals remained in negative-divergence and signalled that the market is not completely of its bearish phase.

FOREX MYR/USD

04The forex market hedging is so very important for exporters of palm oil. Presently, CPO prices are influenced strongly by fluctuations of MYR against the USD. CPO prices rise on weaker MYR against USD and soften on recovery in MYR. As at today’s close, the GMT T.T. indicated that the MYR is now in a correctional phase and called for a firmer MYR in days ahead.

FOREX IDR

05

After having remained weak for the last three weeks, the Indonesian rupiah has started to give indication that it is entering into a minor correction phase. As at Friday’s settlement, the GMT T.T. trading signal entered into a bearish convergence and signalled that the IDR would recover some of its recent excessive losses in the near term.

M’SIAN CPO MONTHLY OUTPUT – STOCK – PRICE

06The Malaysian CPO production in December 2015 continued to decline and this production pattern is likely to persist into the early part of the second-quarter of 2016.

Palm oil stocks dipped at the end of December 2015 and has clearly shown that it has reached its peak in November 2015. A stock level below 2.2 million tonnes would be very supportive for prices.

I believe a simple, historically tested and proven, trading edge with well managed risk parameters is the foundation for consistent trading success.

Looking forward to seeing you at the 1-day Palm Oil Master-Trader Tutorial (MTT) in Kuala Lumpur on 5th March 2016. (Before the KL POC 2016).

Profitably Yours,

G.M.Teoh

PALM OIL PRICE FORECAST

 

Monkey

Dear Friend & Associates,

MAKE 2016 YOUR BEST YEAR YET!

It’s a brand new year and for many of us in the palm oil industry, it’s the time to take a moment and reflect on our aspirations and goals. To look back at how far we have come and adjust our course for our future.

Whether you think your last year was success or a failure, the good news is you can always turn things around or reach for even higher goals and aspirations.

Today, I shall be sharing specifically on how you can improve your trading and hedging this year. Below are a few ideas that you could start implementing RIGHT NOW .

I am a quantitative-discretionary trader. I have made it one of my life’s goals to understand how commodity markets move, to understand how to predict their movements, and to understand the limits of what can be predicted.

In palm oil futures trading and hedging, part of the answer lies in the nature of the market itself. What we call “the market” is actually the end result of the interactions of thousands of traders across the gamut of size, holding period, and intent. Each trader is constantly trying to gain an advantage over the others; market behaviour is the sum of all of this activity, reflecting both the rational analysis and the psychological reactions of all participants.

The main problem is not having a method that works. You cannot escape the laws of probability, at least in the long run. If you don’t have an edge in the palm oil market (and most methods do not), then you will lose!

Understanding the nature of the market is a good start, but there still might be something we are missing about the process of becoming a successful trader.

Commodity markets are not random. People make markets and they are irrational much of the time.

I have over time developed a time-tested method with an awesome trading edge and impressive strike-rate. It is a simple Quantitative Technical Analysis approach called G.M.Teoh Trend-Tracker. It has helped me and my associates score consistent success in both trading and hedging CPO.

With the support of the GMT Trend-Tracker, I have consistently defied the conventional wisdom of trading the palm oil market.

BMD CPO FUTURES – 3RD MONTH (WEEKLY)
GMT TREND-TRACKER – BUY & SELL SIGNALS.

01

Let us look at the trading signals generated over the last eight months for CPO futures. There were six distinctive trading-calls generated by the GMT Trend-Tracker over the last eight months. The red-arrow depicts a buy-signal and the blue-arrow a sell-signal (please see chart on CPO above).

As at the close of trading on 7th January, the tracker-lines are in negative convergence, signalling that the market may enter into a bearish phase. The sell-call would only be confirmed upon a successful crossover.

It is as simple as that!

Back-testing over a period 10 years would show the consistency and effectiveness of my method in making trading and hedge calls.

Traders can recall that over the last eight months there were many bullish and bearish fundamental news hitting the market. Some of them impacted price movements and some did not.

It is the movers and shakers of the market that causes prices to advance or decline (the big boys). Margin-calls are the most powerful market-moving factor. My job is to track the activities of the big players not the small players.

My method simply divorced itself from the market noise and focused on the reality of the market – the trend and the timing of a trade or hedge, which is all that matters! Timing is everything.

CME SBO FUTURES –WEEKLY
GMT TREND-TRACKER – BUY & SELL SIGNALS

02

The CME SBO futures massive downward trend in the third-quarter of 2015 was successfully captured by the GMT Trend-Tracker. (see chart). During the course of the last eight months, six trading-signals were generated by the system and all the signals resulted in the market moving in the direction of the signals that were called.

We can completely take the fundamental approach to palm oil analysis and be fully academic about our analytical approach and yet be wrong in trading. What matters in markets is the trend. Hedging and trading success can on be achieved by trading the direction and duration of a price move, by definition THE TREND.

NYMEX – LIGHT SWEET CRUDE – APRIL 2016

03.png

The price of Light Sweet Crude Oil ended today at a eleven-year low and there seemed to be no light at the end of the tunnel. The Saudi/Iran conflict may some have impact on prices in days to come. Wondering aloud – what would happen if Saudi’s oil pipeline are destroyed? Continuation of the bearish trend would have negative impact on biodiesel. Goldman Sachs declared that crude oil would sink to USD 25-20 per barrel in 2016.

Over the last sixteen months, price volatility and trend in crude oil prices were captured successfully by our GMT TT. Seven trading signals were issued and they all resulted in prices moving in the direction of the trading signals (pls see chart). At today’s close the signals are still calling for more southward move.

FOREX MYR

04It would cause your company a bomb if you are right in hedging  palm oil and wrong in the forex hedge. Over the last sixteen months, the GMT TT nailed all the major moves in an extremely volatile MYR/USD market. Seven clear signals were given during this period (pls see chart). As at today’s close, the GMT TT showed that the MYR is now in a bearish cycle.

FOREX IDR

05The GMT TT was spot-on in tracking the Indonesian rupiah. Over the last fourteen months, seven trading signals were triggered. As at today’s settlement, the trading signal remained bearish and called for further weakness for the IDR in the near term

M’SIAN CPO MONTHLY OUTPUT- STOCK – PRICE

06.png

High palm oil stocks in Indonesia and Malaysia would continue to hinder any strong upward swing in prices in the 1st quarter of 2016. With importers mostly buying from hand-to-mouth, stocks would probably only be able to show large declines in the 2nd quarter of 2016.

Judging from the CPO output of the last three years, it would be difficult for the monthly production to dip below the 1.5 million tonnes in the 1st quarter of this year.

I believe a simple, historically tested and proven, trading edge with well managed risk parameters is the foundation for consistent trading success.

If you are serious & desire to have a PERMENANT change on your trading this year, set yourself up for success by attending my signature program, the 1-day Palm Oil Master-Trader Tutorial (MTT) in Kuala Lumpur on 5th March 2016. (Before the KL POC 2016).

You really have to have a method that has an edge. You have to have confidence in that method. I’ve created a pretty extensive trading course that might help set you in the right direction.

You will re-set your trading and hedging blueprint, right there, that day.

That’s what you’ll learn to do at the Palm Oil Master Trader Tutorial.

Don’t just take my word for it. BE THERE and experience it for yourself.

For registration, programme or further details please click on icons above. We can also be contacted at teohgm@gmail.com (Mobile: +6012 268 8121), david@gbworks.com.my   (Mobile: +6012 204 8918)

Sincerely,

G.M.Teoh

SPECIAL PALM OIL REPORT FOR MASTER TRADERS TUTORIAL STUDENTS

Dear Friends & Associates,

Year 2015 was indeed a remarkable year for the palm oil market.

The roller-coaster market influenced by too many outside factors took many analysts by surprise.

The much anticipated El Nino bullish impact failed to materialize in the 2Q of 2015 and instead showed its bullish head in late-September boosted by the prolong haze that cut out sunlight causing massive stress to the oil palm trees. We may get to see in months ahead the impact on fresh fruit bunches due to the prolonged period of lack of water and lack of sunlight.

Following the peak crude palm oil output months, palm oil stocks remained at historical-high levels of 2.62 MT and the sluggish Malaysian exports did little to contain the bearishness. Very few would dare to estimate the Indonesian palm oil stocks because they could be easily out by half to a million tonnes! Please see chart.

In the BMD CPO futures chart below, the short-term GMT trend-tracker signal are positive as at today’s close and indicated the potential for more upward price adjustments. The RM2,450 level would be the next formidable price hurdle. The chart says it all!

The sharp losses in the ringgit and Indonesian rupiah against the US dollar provided some underlying support to crude palm oil prices. Recent minor knee-jerk recovery in these two currencies saw some technical price rebound on account of speculative short-covering and short-hedge unwinding. Currently, based on the GMT Trend-Tracker signals, both the currencies are in a technical correction phase following recent excessive losses. We may get to see short-term influences on CPO prices due to some choppy fluctuations in both these currencies in weeks ahead. (see charts)

Light sweet crude oil prices struggled to stay above the USD45 per barrel and appear set for further sideways fluctuations with Iranian oil coming into the pipeline. Current conflict in the Middle-East has the potential to deepen and help change the dynamics of the crude oil market. Crude palm oil for biodiesel may not be too attractive with crude oil below USD45 per barrel. Kindly take a look at the light sweet crude oil chart. The GMT trend-tracker signals are incorporated in the chart and they are suggesting more sideways price action in days ahead.

CME SBO futures recovered from it late-September lows at the 26.00 US cents and is now faced with an overhead barrier at the 29.00 US cents per lb. A successful push above these level would provide the positive momentum to take prices higher to test its minor price resistance around the 31.00 – 32.00 US cents levels.

Important message for past students of the
Palm Oil Master Trader Tutorial.

I shall be conducting the Palm Oil Master Tutorials in Bali, Indonesia on 23rd & 24th November 2015. (Immediately before the Indonesian Palm Oil Conference-IPOC).

  • Early Bird Rate: USD 1,500
  • Normal Rate: USD 1,800

Past students are welcome to attend for a refresher session at special rate USD1,000.

Past students who recommend a fresh student would get to attend the Master Trader Tutorials for FREE. Limited seats are available!

For more information, please email: teohgm@gmail.com OR mtt@gbworks.com.my

M’SIAN CPO OUTPUT- STOCK – PRICE01BMD CRUDE PALM OIL FUTURES02CME SBO FUTURES03LIGHT SWEET CRUDE04IDR/USD05MYR/USD

06

Palm Oil Price Outlook 2015

01

6th  FEB, 2015

Dear Friends & Associates,

The Year of the Horse (2014) was indeed a challenging year for the palm oil industry.

As thousands of horses gallop away on February 19th, a flock of goats, with their heads held high, would usher in the new spring for the Chinese New Year of the Goat. We hope that the sun does not rise from the West in 2015! The Goat promises to bring a better time for us all! Wishing you a Happy & Prosperous Chinese New Year.

Over the last six weeks, CPO prices rallied and then gave back all it gains immediately. Prices initially advanced from a low of RM2,100 in mid-December, 2014 and hit a high of RM2,397 on 8th January,2015. Prices failed to hold above the RM2,350 resulting in the market heading south and returning all of its earlier excessive gains and hit a decline-low of RM2,106 on 30th January, 2015. The April futures then rebounded strongly on strong short-covering and fresh speculative interests and settled Thursday (5th Feb,2015)  with hefty gains at RM2,310.

How did our daily G.M.Teoh Trend-Tracker signals (GMT-T.T) react to the price movements during the course of the bullish and bearish rallies?

On 19th December, 2014, the GMT-TT gave the buy-signal around the RM2,150 level and that resulted in some strong upward momentum with the bullish rally peaking at RM2,397 on 8th January, 2015.

Following the strong upward move, the GMT-TT signal triggered the sell-signal around the RM2,350 level on 16th January, 2015. This bearish sell-signal saw prices declining to a low of RM2,106 on 30th Jan, 2015.

On 4th February, 2015, the daily GMT-TT again gave the buy-signal at close. Prices rallied strongly on 5th February and as at the close the GMT-TT continues to show that the immediate term price trend is positive. (please see chart for the GMT-TT trading signals).

BMD CRUDE PALM OIL – APRIL, 2015 Futures

01

Strictly from a technical point of view, the immediate-term underlying strength of the market is still constructive. An immediate overhead price-resistance now stands at the RM2,350-RM2,380. The upward trend or cycle would expand if these technical hurdles are successfully vaulted with the prospects of April futures trading above the RM2.400 levels in the near-term.

The immediate term price-support levels are now adjusted higher to RM2,250-RM2,200. The chart-picture would turn negative should these supports be violated.

However, we would continue to use our reliable GMT-TT to provide us indication of changes in the market trend.

Outside-factors that could influence CPO prices in the coming days.

Apart from the changing fundamentals of palm oil; crude oil prices would continue to hold centre-court in days ahead. The soyoil price trend and the Malaysian Ringgit are set to have some strong influence on CPO price direction in the very near term.

M’SIAN MONTHLY CPO OUTPUT,EXPORTS,STOCKS & PRICE

02

CME SBO FUTURES MCH 2015

03

The CBOT soyoil futures are now in upward trend following a sharp decline that took the market briefly below the 29.50 U.S. cents level some five trading days ago. Based on the GMT-T.T. the market has entered into a rebound phase and could re-visit it’s next up-side target at the 32.00 U.S. cents. The GMT-TT triggered the buy-signal on 4th February.

NYMEX CRUDE OIL- MARCH 2015

The NYMEX crude oil futures prices rebounded after a prolonged downward trend. The GMT-T.T. gave the buy-signal toward the end of January and then entered into negative convergence during yesterday’s close. Based on the GMT-T.T. crude oil futures is now in a negative phase and may drift lower in the immediate term to re-test its decline-lows and immediate chart support at the USD 45 level.

NYMEX CRUDE OIL FUTURES

04

MALAYSIAN RINGGIT-USD

05

The ringgit depreciation against the USD appears to have hit a temporary-bottom. The GMT-T.T. entered into a strong negative convergence on Thursday’s close and signalled that the downward pressure on the ringgit may be over for the immediate term. Prospects of the ringgit moving into a recovery phase is very likely ow. Palm products priced in USD would be impacted by such a move.

Kindly be inform that the next Master Trader Tutorial (Palm Oil) would be held in Kuala Lumpur on 27th & 28th February, 2015. (Immediately before the POC2015 Palm & Lauric Oils Price Outlook Conference in Kuala Lumpur). New students are welcome.

Past students who wish to do a re-attendance tutorial are also welcome. A special fee would apply.

Further information and registration can be obtain from our website: http://www.palmoil-mtt.com

Profitably Yours,

G.M.Teoh
gmteohgm@gmail.com
hp 012 2688121

Palm Oil Price Outlook December 2014

19th Dec, 2014
01

Dear Friends & Associates,

Wishing you a Merry Christmas and Happy Prosperous New Year.

The ride ahead into the early part of 2015 could be bumpy.

It is time to take another look at the CPO market. In these very challenging times, it is anyone’s guess whether CPO prices will remain at current levels or slide down further in the coming months.

From it rebound-highs of RM2,345 in early-November, CPO prices declined and entered into congestion trading for four weeks at around the RM2,250-RM2,200 levels. This was followed by a violation of its lower band-trading support at RM2,200 on 28th November and that brought on a strong wave of selling pressure causing prices to fall below RM2,100 briefly.

Over the last three weeks of December, CPO prices meandered like a snake in a large water pipe between the RM2,100 to RM2,200 levels.

During the course of the seven-week price congestion, the open-interest or size of the entire market dropped sharply from its historical peak of over three hundred and thirty thousand contracts to 219,940 contracts as at Friday’s close. This gives rise to the notion that we are still in a negative cash flow phase.

Our weekly G.M.Teoh Trend-Tracker (GMT T.T) triggered the sell-signal on 28th November and remained negative for the near-term trend. (see chart)

BMD CRUDE PALM OIL – MARCH, 2015 Futures, Weekly Chart

01

At the moment it appears that the market is in tunnel and the light is dim.

Technically speaking, the immediate-term price-support is peg at the RM2,100-RM2,080. Violation of these key chart-support levels in the coming days could generate fresh hedge and speculative selling momentum and force the market to seek for a new trading base around the RM1,930-RM1,900.

Immediate term price resistance are expected around the RM2,180-RM2,200 levels.

The GMT T.T. gave the sell-signal for the CME soyoil futures in early-November. (see chart).

Based on the weekly chart, CME SBO futures have an important support at 31.50-31.00 cents. A break below these levels would mark the resumption of the bearish trend.

CME SBO FUTURES JAN 2015 –Weekly Chart

02
M’SIAN MONTHLY CPO OUTPUT,EXPORTS,STOCKS & PRICE

03
Please be inform that the next Master Trader Tutorial (Palm Oil) would be held in Kuala Lumpur on 27th & 28th February, 2015. (Immediately before the POC2015 Palm & Lauric Oils Price Outlook Conference in Kuala Lumpur). New students are welcome.

Past students who wish to do a re-attendance tutorial are also welcome. A special fee would apply.

Further information and registration can be obtain from our web: www.palmoil-mtt.com

Profitably Yours,
G.M.Teoh.
gmteohgm@gmail.com
hp 012 2688121

Palm Oil Price Outlook November 2014

3rd  Nov, 2014 

01

Dear Friends & Associates,

It was indeed a well-defined six-month bearish rally that took CPO prices from its early-March, 2014 highs of RM2,910 per tonne to a five-year and decline-low of RM1,914 on 5th September 2014.

It was like pressing a water polo ball down to the bottom of a swimming pool. When the pressure was lifted, the ball simple rebounded to the surface.

During the course of this lengthy negative market downtrend and the subsequent technical price rebound, the very consistent G.M.Teoh Trend-Tracker (GMT T.T) provided two very solid trading signals and helped hedgers project the price trend accurately.

A clear-cut sell-signal was given on week-ending 21st March, 2014 and that was followed much later by a powerful buy-signal on week ending 12th Sept, 2014. We have so far witnessed a nine-week price rebound-rally that lifted CPO prices RM397 from its sell-down lows.(please see chart)

As at last Friday’s close, both the daily and weekly GMT Trend-Tracker maintained their buy-signals and remains positive for the price trend and suggested that the upward price momentum would continue in the near term.

BMD CRUDE PALM OIL FUTURES – JAN 2015 Futures,  Weekly Chart

Chart 1

Be assured that in the event of any change in trading-signal call from the GMT T.T., you shall be inform accordingly in our next Palm Oil Price Outlook report.

The GMT T.T. also gave the same clear trading signals for the CME soyoil futures. (please see chart).

Our amazingly awesome GMT T.T. was designed to cut out market noise and help traders indentify the true market trend to enhance their hedging and trading activities. Students of our Palm Oil Master-Trader’s Tutorial (MTT) have indeed benefited greatly from this time-tested algorithm trading system.

Let’s us take a good look at the realities of the market.

The weekly volume swelled towards the tail-end of the downtrend and continued to expand into early-September as prices advanced. Meanwhile, the overall open-interest or the size of the market, hit an exchange-high above 330,000 contracts (8.25 million tonnes) in early-September and continued its decline to 272,364 contracts as at Friday’s close. The most actively traded January futures open-interest dropped from a peak of 96,912 contracts to 59,469 contracts last Friday.

The overall open-interest may be lower by now because the Exchange Clearing House continues to allow trade players to keep both their liquidated long and short contracts as open contracts in the Clearing House books!

Recent negative cash-flow suggested that the nine-week price rally was actually the result of short-hedges liquidation and speculative short-covering. At the same time, the long-hedges unwinded too along with speculative marathon-bulls closing out positions. In most instances, a price rally where the cash flow is negative, the upside potential is limited.  Once the technical buying or short-covering strength is over, the market invariably would retrace its direction with the law of gravity taking over and forcing prices to re-visit some its earlier lower traded levels.

CME SBO FUTURES Dec 2014 – Weekly Chart

Chart 2
What We Already Know:
The much anticipated El Nino failed to materialise in 2014 and had in fact over the last two years humbled many analysts.

We know that most analysts are sincere and they can be sincerely wrong!

We know that the price differential between soyoil and palm oil had narrow drastically and the spread would once again widen in days ahead.

Indonesia mimicked the Malaysian export-duty structure and would continue to do so in the current competitive export environment.

Indonesia’s monthly output, stocks and exports would remain a mystery and we shall have to continue to guess.

In 2014, Malaysian CPO entered into its yearly-high crop output in July and hit a year high of 2.631 million tonnes in September. Stocks surge in August and ended September at 2.089 million tonnes. (please see chart on Malaysian CPO output, stocks and prices)

In 2013, CPO output peaked the year in October at 1.972 million tonnes while stocks held high slightly below the 2 million tonnes till end-January 2014.

Similarly, in 2012, the high production months started in July and peaked in September. Stocks were high from July right into March of 2013.

Our guess is that CPO output may not tapper off too sharply from now till at least December 2014. Palm oil month-end stocks would continue to remain high for another two to three months. 

MONTHLY M’SIAN CPO OUTPUT,STOCKS & PRICE

Chart 3

We know that large palm oil importers, China and India had covered their nearby needs during the recent price weakness. With some believing that they have also covering a large portion of their far forward needs and they are not expected to panic in the event of a price surge in the immediate term.

We know that the weak and falling crude oil prices have diminished crude palm oil appeal as alternative fuel.

Malaysia’s mandate to increase palm oil content in diesel fuel from 5% to 7% this month would only reduce 700,000 tonnes annually from the stockpile .

What’s Next?

Market always trade on what that is not priced into markets.

The MPOB monthly data are due for release on 10th November. The price action over the next few days need to be monitored closely as it would reflect the thinking of large traders. Near-term scenario would turn negative in the event of a large price pullback prior to the report.

Presently, there is upside price-target at the RM2,350-RM2,375 levels. Should the underlying strength of the market stays strong, these technical price-hurdles are expected to be tested in the immediate term.

A word of caution. As traders, it is our sole responsibility to prepare for the worst case scenario. For the coming days and weeks, we would continue to depend on our GMT T.T. to provide the leads on the market’s duration and direction, by definition the trend.

Kindly be inform that the next Master Trader Tutorial (Palm Oil) would be held in Kuala Lumpur on 27th & 28th February, 2015. (Immediately before the POC2015 Palm & Lauric Oils Price Outlook Conference in Kuala Lumpur). New students are welcome.

Past students who wish to do a re-attendance tutorial are welcome. A special fees would apply.

Further information and registration can be obtain from our web: www.palmoil-mtt.com

Profitably Yours,

G.M.Teoh.
gmteohgm@gmail.com
Contact: 012 268 8121

 

Palm Oil in the Year of the Horse: May 2014

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Palm Oil in the Year of the Horse: May 2014

 

Dear Friends & Associates,

The crude palm oil futures prices expanded on it downward rally in May and settled today near the tail-end of its three-month old bearish cycle.

My earlier price projection was wrong. Those who sold in May and went away, really did well!

The August futures prices made new-lows for 2014 on 26th May at RM2,483 per tonne. Over the last seven-trading days, the August futures were locked in range-trading within the RM2,540- RM2,485 levels.

Strictly from a technical point of view, the main trend of the CPO futures is still negative.
The weekly GMT trend-tracker which triggered the sell-signal on March 21st stays negative for the price trend as at today’s close. (see weekly chart)

Currently, the important technical price-support levels of RM2,520-RM2,485 are being test. In the event of a downward break from these levels, it would signal the resumption of the bearish price trend. Renewed selling pressure from current levels may take prices lower to re-visit the RM2,450-RM2,400 levels last seen in October 2013.

BMD CPO AUGUST FUTURES- WEEKLY

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While most analysts and traders are concern about the downside of the market now, cautious traders would be keeping a watch full eye for clues of a turnaround to this well-defined three months old downtrend.

An upper-end chart resistance now stands at the RM2,530-RM2,550 levels. We are expecting to see some meaningful upward technical price adjustments in the course of the next 20-trading days.

Should the price rebound penetrate and hold above these chart-resistance levels, we would take it as a sign that the three-months downward trend has ended.

An upward retracement from current levels may lift prices higher to test its upside recovery-target at the RM2,600-RM2,650. It is quite normal for a grossly oversold market to recover 25 to 30 percent of its losses.

Please be inform that my next Master Trader Tutorial (Palm Oil) would be held in Singapore on 3-4 October, 2014 and in Jakarta in early-November 2014. Further information and registration can be obtain from our web.

Profitably Yours,

G.M.Teoh

teohgm@gmail.com
012 2688121

MPOB Month-End Data Charts for your analytical pleasure.

MPOB End-April Stock, Output & Price

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MPOB End-April Export & Price

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Palm Oil in the Year of the Horse: 24th April, 2014

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Palm Oil in the Year of the Horse: 24th April, 2014

Dear Friends & Associates,

Mother nature defied the weather man’s call for more hot and dry spell as intermediate rain fell in much of late-March and April with the weather pattern shifting to the South-West monsoon.

Would the El Nino phenomena make a comeback? And how would palm oil prices react in days ahead. Output of fresh fruit bunches would drop sharply over the next eight to ten months in event of such a possibility and prices are set to enter into another round of bullish momentum.

Historically speaking, El Nino events tend to develop during the period March-May and they tend to reach their maximum strength during December-February and typically persist for nine to twelve months and occasionally persisting for up to two years. Traders would continue to look to the skies in days ahead.

The MPOB end-March output, stock and export figures received a lukewarm response from traders. (see chart below)

From March 10 peak of RM2,910 to April 8 decline-low of RM2,573, the market lost a hefty RM330 per tonne.  Bullish market sentiment was grossly dampened as earlier bullish hedgers and traders unloaded their long-positions along with fresh speculative and hedge selling that added bearish fuel to the largely overbought market. There were only two mild upward corrections or adjustments during the sell-off and they fizzled out as fast as they started.

An interesting point to note was that during the price decline, the market’s backwardation narrowed significantly. As at Thursday’s close the spot-May futures commanded a RM33 premium over the nearby-June futures price and a RM50 premium over the forward July futures. The spot-May premium over the far forward August and September futures were at RM60 and RM65 respectively. The narrowing of the backwardation-premiums gives rise to ideas that the nearby supply-tightness or squeeze may be temporary over.

BMD CPO JULY FUTURES- DAILY 

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AFTER A MASSIVE PRICE DECLINE, MARKETS  USUALLY WOULD TURN AROUND WHEN YOU LEAST EXPECTED IT TO HAPPEN – THAT IS GUARANTEED!  

As at Thursday’s close, the daily GM Teoh Trend-Tracker signals remained neutral-to-slightly negative after having triggered the buy-signal on April 14th. (see chart).

We are likely to witness is some range-trading around the RM2,700-RM2,640 levels in sessions ahead. A successful break above these overhead price barriers would set the course for another leg of upward momentum.

If you put a pistol on my head and ask where prices would be headed then, I would simply say RM2,750-RM2,780 for the immediate term.

MPOB End-March Stock, Output & Price

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Kindly be inform that my next Master Trader Tutorial (Palm Oil) would be held in Singapore on 3-4 October, 2014 and in Jakarta in early-November 2014. Further information and registration can be obtain for our web.

Profitably Yours,

G.M.Teoh

teohgm@gmail.com
012 2688121