The Softs Review for the week of September 13rd, 2010
Among the soft complex, sugar, coffee and cotton prices have all been trending higher. At times they act surprisingly strong. Sugar values ended this past (holiday shortened) week in such a fashion, ripping higher, before tapering off Friday afternoon in a bout of profit taking. Coffee values surged into new high ground, then backed off as the week wound down, culminating with a pin to 190 as the October option series expired on Friday. Cotton has moved above 90 cents and has visibly generated talk of $1.00 being next.
Can these three continue on this path? Yes they can, however, in order to do so those markets will require additional fuel, you know a series of fundamental stories, or a technical picture which attracts buying, or at least maintaining one that is not attractive to selling. If not, then existing longs may grow tired and decide to take profits. So I suggest it is important to keep an eye out for signals that might suggest that these markets have reached a point of exhaustion.
Don't get me wrong, I am not even remotely suggesting that any of these three markets have reached such a point, at least not yet. But it is inevitable that eventually they will. My point is to prepare to identify what sort of signals to watch for. Potential signs of trouble might cause action from funds, which seem to have fueled these major moves upward.
In the meantime bulls should enjoy the run. Looking for 26.5 cents in sugar, a test of $2.00-2.08 in coffee, and $0.98-$1.05 in cotton.
To reviews others futures markets this week: pitguru.com |
