Report Summary. Prices are likely to hold above MYR 2550 and trade on mixed note ahead of turning higher in the coming sessions

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1 Daily BMD CPO Price Outlook and Strategy Decision enabling market analysis & price outlook For Dec 31, 2013 Report Summary BMD CPO Mar 14 Futures Fundamental Summary MYR 2631( 1) on Dec 30, 2013 Price drivers Anticipated flood like situations in Sarawak Weakness in MYR Robust soybean planting pace at Argentina Anticipated commencement of bean supplies from Brazil Overall Impact Marginally Bullish Marginally Bullish Marginally Bearish Marginally Bearish Range bound Technical Summary Price outlook summary Price Ranges Strategy Review Trading Strategy Prices are likely to hold above MYR 2550 and trade on mixed note ahead of turning higher in the coming sessions Prices are likely to hold support above MYR 2550 and trade on mixed note within MYR ahead of turning higher in the coming 3 5 sessions. Next five sessions Next ten sessions Initial Level Subsequent Level IL SL MYR 2610 MYR 2650 MYR 2600 MYR 2700 IL=Initial level (Initial Expectation from the current closing) SL= Subsequent level (The subsequent forecast after reaching the initial level) For fresh positions traders may consider below mentioned strategy. Filled on Position Entry Objective Stop Loss Buy Near 2625 Near 2690 Below MYR 2590 Performance Audit (Updated till 31 Oct, 2013) BMD CPO Futures Since 2003 FY Oct 13 Range honored % 77% % 80 % Net profit / Gross profit Ratio % 89% % % ROI % 5223% % % Fundamental Analysis Review Sentiments, at BMD CPO counters remained ragebound on the back of weak soy oil counters on one hand, and weaker MYR coupled with weather disturbances at major palm growing areas at Malaysia on the other. As per the warning displayed on Malaysian Meteorology department website, intermittent rain occasionally moderate occurring over state of Sarawak one of the major palm growing areas is expected to persist until Tuesday, 31st December Such rains might cause flooding to low laying areas. Such scenarios might keep the sentiments on a positive tone. 1 Discuss with our expert Phone: E mail: services@transgraph.com Internet:

2 MYR continued with its weakness vis à vis USD thus supporting the sentiments. Moving forward, further weakness is anticipated in MYR owing to which sentiments might remain positive. At the Argentina front, sowing is going at a brisk pace. Same stood at 83.2% vs 80.1% same period previous year. Such scenarios are happening on the back of antcipation of favorable weather conditions. Owing to which, sentiments might remain negative. On the other hand on the back of no weather hiccups, Brazilian production anticipations are holding good. Further, harvesting in some of the major bean growing areas of Brazil is anticipated to commence from next week onwards. Tracking such scenarios, sentiments remained negative. No weather disturbance anticpation at Argentina and Brazil coupled with Brzilian bean supplies hitting the market in a weaks time might keep the sentiments on a negativet one. Neverthless, weaker MYR and weather disturbances led production drop from Malaysia might keep the sentiments on a positive tone. hence in the end look for BMD CPO futures to remain rangebound. Technical Outlook BMD CPO Mar 14 Futures: MYR 2631 /MT BMD CPO prices traded on flat note within tight range on Monday after hitting a two week high on thin volumes. Prices fell marginally and settled at MYR 2631 and holding above its 10 and 20 day EMA after witnessing sharp decline in the previous week exhibiting positive bias. Prices are trading on positive note after finding support near lower Bollinger Band line and closed above middle Bollinger band line amid follow through buying pressure. On the daily setup, the 9 Day RSI is turning higher after approaching near oversold zone while stochastic (14/3/3) is also rising after hovering in oversold zone. In the monthly chart MACD (12/26/9) is turning flat after triggering buy signal displaying bullish momentum in the medium term. On the higher side MYR 2660 shall act as immediate resistance zone followed by the recent swing high of MYR 2692 as next important resistance and close above the same shall accelerate further positive momentum. On the downside the level of MYR 2550 shall act as immediate support and break below the same, MYR 2530 followed by MYR 2506 shall act as next support zones to hold prices on firm note. Concisely, prices are likely to hold above MYR 2550 and trade on sideways to positive note towards MYR in the coming 5 7 sessions. CME Soy Oil Mar 14 Futures: Last closing (Dec 30, 2013): cents/lbs. Prices traded on weak note on Monday and broke below crucial support of 39 cents and sustaining thereof for a few sessions, further extension of weakness towards cents and lower remain open in the coming sessions. 2

3 Failure to sustain below 39 cents shall prolong the existing consolidation of to cents for few more sessions till it breaks out either direction. For complete market outlook / trading strategy, please follow our Daily CME Soy Futures complex market mentor. BMD Daily Future Volatility RISK PARAMETER BMD Daily Future AVaR RBD Palmolein Spot Volatility RBD Palmolein Spot AVaR Facts and Figures digest RBD Olein (local) to CPO spreads (INR/10 kg) Refining 20/10 kg Refining cost exclusive of Stearin and PFAD realization All prices on Kandla basis Mini Charts Palm oil refining margins (FOB Malaysia basis, $/ton) Gross margin after product realization Soy RBD Olein price spread (At origin, $/ton) Sun Soy price spread (FOB Argentina, $/ton) Soy CPO price spread (CNF India, $/ton) Spread (CPO Brent) USD/ton 3

4 Indonesia Spot BMD CPO (USD/ton) MY CPO BMD Future (USD/ton) Spread CME BO BMD CPO (USD/MT) INR vs. USD MYR vs. USD Euro vs. USD Dollar Index NYMEX Crude ($/barrel) BMD CPO futures market prices BMD Futures Dec Open High Low Close (Previous Close) Mar (2632) Apr (2635) * Open Interest is for the previous trading session; Units: Palm oil MYR/ ton. Contract Specifications: 1 lot = 25 tons; Cumulative Volume Open Interest*

5 Physical market prices Malaysia Dec 30, Dec 27, % Market and details South Malaysia Crude Palm Oil, Dec 13 (MYR per ton) South Malaysia Crude Palm Oil, Jan 14 (MYR per ton) South Malaysia Crude Palm Oil, Dec 13 (USD per ton) Malaysia RBD Palmolein, FOB Dec 13 (USD per ton) Malaysia RBD Palmolein, FOB Jan 14 (USD per ton) Malaysia RBD Palmolein, FOB Feb 14 (USD per ton) Malaysia RBD Palm oil, FOB Dec 13 (USD per ton) Malaysia RBD Palm oil, FOB Jan 14 (USD per ton) Malaysia RBD Palm oil, FOB Feb 14 (USD per ton) Malaysia RBD Palm Stearin, FOB Dec 13 (USD Per ton) Malaysia RBD Palm Stearin, FOB Jan 14 (USD Per ton) Indonesia CPO FOB Dumai/Belawan Dec 13 (USD Per ton) Indonesia CPO FOB Dumai/Belawan Jan 14 (USD Per ton) Indonesia CPO FOB Dumai/Belawan Feb 14 (USD Per ton) *Spread USD Per ton (CPO Indonesia CPO Malaysia) H Holiday; NA Not Available *FOB QUOTES Physical market prices Market and details Dec Dec % Indian CNF Kandla ($/ton) Indian CNF RBD Kandla ($/ton) Indian CNF Soy Kandla ($/ton) India CPO Kandla High seas (INR/10 kg) India RBD Palmolein Kandla (INR/10 kg) India RBD Palmolein JNPT (INR/10 kg) NYMEX Crude Oil Feb 14 Futures (USD/bbl) H Holiday; N/A Not Available. 5

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