The Softs Review
For the week of March 14th, 2011
This past week, after reaching new high levels, the soft markets fell back, some harder than others. While fundamentally supply demand did not change overnight, technically this type of action may attract additional selling, especially from longs seeking to realize profits.
The move lower will allow producers a welcome relief from margin calls. Some may also see fit to administer additional hedges. The establishment of those hedges could add weight to vulnerable markets. The earthquake and subsequent tsunami has Japan's economy under stress. The impact on markets will be assessed, but problems will be far reaching.
After essentially reaching an objective of $3.00, Coffee ought to remain under pressure. During the week look for support at -, resistance -, in KCK. Premium Subscribers, get the price details in Jurgens’ daily reports this week!
Sugar, I will be surprised if SBK has the wherewithal to revisit 30 cents this week. Instead I have my sights set on 27 cents, which may be available sooner than later. If able to hold 27, then look for a decent bounce. If not, then the downside could open up.
Cocoa may struggle to return back over 3500, but it can if it has the ability to hold the lows made last week. Underneath 3200 is the area that offers support for CCK, but below that 3000 becomes available. Watch for political developments to keep bullish forces active.
The old crop, May and July Cotton are injured, but can still be very crazy. The trade remains short and needs to cover, but long liquidation seems to be coming, so look for defensive action. But do not fool yourself, the front months have enough fuel left for another explosion.
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