The crude palm oil (CPO) futures contract on Bursa Malaysia Derivatives will likely trade on a weaker trend next week tracking the cautious global market sentiment and following the holiday shortened-week, said a trader on Saturday (May 23).
Palm oil trader David Ng said the lower crude oil prices on Friday would also influence the commodity to drop further.
“We expect an easier movement for next week, as traders take cues from global markets,” he told Bernama.
Reports that China has announced moves to tighten its policy control over Hong Kong prompted a sharp sell-off in global markets and could heighten the US-China tensions.
“CPO prices would likely trade between the RM2,120 support level and RM2,250 resistance level,” Ng said.
For the week just ended, the market was traded mostly higher on better demand, tracking the firmer soybean oil price, crude oil prices and the resumption of India’s import of Malaysia’s CPO.
On a Friday-to-Friday basis, the CPO futures contract for June 2020 improved RM124 to RM2,240 per tonne, July 2020 increased RM98 to RM2,189 per tonne, and August 2020 gained RM78 to RM2,167 per tonne and September 2020 rose RM73 to RM2,175 per tonne.
Weekly turnover rose to 240,413 lots from last Friday’s 190,424 lots while open interest decreased to 262,459 contracts from 265,004 contracts.
On the physical market, the CPO price for June South was RM95 higher at RM2,191 per tonne.
The local CPO futures market will be closed on May 25-26, 2020 for the Hari Raya Aidilfitri celebration. – Bernama