Rubber futures on the Tokyo Commodity Exchange may climb to the highest level since July 2008 because of “bullish momentum,” according to technical analysis from Singapore-based broker Phillip Futures Pte Ltd.
The moving average convergence/divergence indicator crossed above the shorter-dated signal line on Sept. 22, pointing to higher prices, said Ker Chung Yang, analyst at Phillip Futures.
The most-active contract, which increased 17 percent this year, may test resistance at 332 yen per kilogram ($4,006 per metric ton) next week, Ker said in e-mail yesterday. “It’s possible for TOCOM rubber to extend gains,” he said. The price reached 324.1 yen yesterday, the highest intraday level since April, and traded at 323.6 yen today.
Rubber, used to make tires and gloves, may be bolstered by strengthening crude oil prices and increasing demand for tires after U.S. auto sales in September rose to a seasonally adjusted annual rate of 11.8 million, compared with 9.4 million a year earlier, according to a Phillip Futures’ note dated Oct. 4. Demand in China, the world’s biggest consumer, may outstrip supply in the short term because of economic growth, it said.
The MACD indicator is derived by subtracting a 26-day exponential moving average from a 12-day average. A second measure, called the signal line, uses a nine-day moving average of the MACD indicator. In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.
(bloomberg.com)
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