21 Mar 2016

CPO Prices Moved Positively, Assisted by a Weakening Ringgit

This afternoon, the US dollar strengthened against the Ringgit. The US dollar-Malaysia Ringgit pair was observed rising 0.52% to 4.0720.

The weakened Ringgit has made commodity prices traded in that currency relatively cheaper for overseas buyers, thus increasing their demand.

The price of the most active CPO contract on the Malaysia commodity exchange today is seen to be increasing. The price of the June 2016 contract, which is the most active contract, strengthened by 14 Ringgit and traded at 2.693 Ringgit per ton.

See: CPO Price Strengthens Bolstered by the Weakened Ringgit and Increased Crude Oil

An analyst at the Vibiz Research Center predicts that the price movement of future CPOs in subsequent trades has the potential to strengthen due to the potential for the Ringgit to weaken with the strengthening of the US dollar.

The price of the June 2016 CPO futures contract on the Malaysian commodity exchange has the potential to test the Resistance level at 2.740 Ringgit and 2.790 Ringgit. Meanwhile, the Support level that will be tested if the price decreases is at 2.640 Ringgit and 2.590 Ringgit.

Editor: Asido Situmorang