Commodity Trading Tips for Ref. Soya oil by Kedia Commodity

Ajay Kumar Kedia 26 August 2013

Ref Soya Oil Ref. Soya oil settled down -0.35% at 684.5 tracking weak spot demand amid profit booking after prices were supported by improving demand against limited arrivals from producing belts. The trading sentiment improved further on concerns of heavy rainfall in the top producing state of Madhya Pradesh, which may damage the crop. Meanwhile, a weak rupee makes edible oil imports expensive, but raises the returns of oilmeal exporters.. Traders do not rule out some more corrections in rates in the near term but reports of fear of crop damage in some parts of its growing areas due to excess rains could keep supporting prices in medium term. However industry sources say that this year the crop production may remain higher by at least 18% at 13.34 million tons as compared to last year. Overall sentiments are expected to remain slight firm as good improved physical market buying has supported the market sentiments. There has been decent demand in physical markets last week as worries over standing crop in MP and Rajasthan took charge. There are worries that a heavy spell of rainfall in Madhya Pradesh at this stage could hurt the standing crop. However, not much of this threat has materialized so far. Prices had plummeted to their lowest levels in nearly two years ahead of the kharif harvesting. At the Indore spot market in Madhya Pradesh, soyoil was steady at 699 rupees per 10 kgs. Technically market is under long liquidation as market has witnessed drop in open interest by -2.03% to settled at 69880 while prices down -2.4 rupee, now Ref. Soya oil is getting support at 681.3 and below same could see a test of 678.1 level, And resistance is now likely to be seen at 690.6, a move above could see prices testing 696.7.