COTTON

General Comments:  Futures closed sharply higher on ideas that the US crop is smaller than USDA said last week and on US Dollar weakness that created some hopes of improved demand.  Talk of big rains in Pakistan created ideas that crops could be lost there.  Chart trends still show a neutral bias, but the market appears ready to go higher.  Demand remains soft.  Countries like India are still offering Cotton at prices below those seen in the US, and the government is now allowing unrestricted exports for the next couple of months.  Bad weather in the US is still around, with little rain in the forecast for major Texas growing areas for the next week.  It is very hot in the Cotton areas of Texas.  No relief from the drought appears likely and crop losses in the state should be significant this year.

Overnight News:  The Delta and Southeast will get mostly dry conditions, but a few showers are possible late in the week.  Temperatures will average above normal.  Texas will be mostly dry, but some showers are possible across the Panhandle later this week.  Temperatures will average above normal.  The USDA average spot price is now 106.66 ct/lb.  ICE said that certified Cotton stocks are now 0.014 million bales, from 0.014 million yesterday.  USDA said that net Upland Cotton export sales were -337,000 bales this year and 387,200 bales next year.  Net Pima sales were 200 bales this year and 900 bales next year.  

Chart Trends:  Trends in Cotton are mixed.  Support is at 104.00, 101.00, and 100.00 October, with resistance of 110.00, 112.00, and 116.00 October.

FCOJ

General Comments:  Futures closed higher again yesterday on fund buying.  September was once again the strongest month as traders roll out of that month and into back months.  Several potential tropical storms have surfaced in the Atlantic in the last week.  However, none of the potential storms are likely to impact Florida if they develop at all.  One has missed any land in North America and is now past Bermuda and moving northeast.  The others do not appear to be threats to Florida in the near future if at all.  Charts show that trends remain down overall, but futures appear very oversold and the current short term recovery could continue.  Florida for now remains mostly warm and is getting scattered showers.  Brazil is also seeing moderate temperatures and episodes of scattered showers for now.  Charts show that the recent moves lower has been extreme and that a rebound is possible at any time and could have started Friday. 

Overnight News:  Florida weather forecasts call for scattered showers and storms.  Temperatures will average near to above normal.   

Chart Trends:  Trends in FCOJ are mixed.  Support is at 170.00, 164.00, and 159.00 September, with resistance at 179.00, 183.00, and 186.00 September.

COFFEE 

General Comments:  Futures were sharply higher yesterday on fund buying.  Industry and origin appeared to be quiet.  There is a lot of talk that Vietnam has sold all of the Robusta it has to sell for now.  Brazil is not selling much, and Central America and Colombia can only sell new crop as the old crop appears sold out.  However, industry is said to be covered for now.  Weather in Brazil is good, but other parts of Latin America could use improved weather.  It was too dry in Central America at flowering time and we have heard reports of too much rain again now in Colombia  Warmer temperatures are expected for much of the week in Brazil.  Chart trends remain up in London and turned up this week in New York and Sao Paulo.  

Overnight News:  Certified stocks are lower today and are about 1.484 million bags.  The ICO composite price is now 218.74 ct/lb.  Brazil should see mostly dry weather.  Temperatures will average near to above normal this week, but cooler this weekend. 

Chart Trends:  Trends in New York are up with objectives of 275.00 September.  Support is at 259.00, 256.00, and 253.00 September, and resistance is at 266.00, 272.00, and 273.00 September.  Trends in London are up with objectives of 2550 September.  Support is at 2330, 2315, and 2260 September, and resistance is at 2420, 2440, and 2480 September.  Trends in Sao Paulo are up with objectives of 350.00, 362.00, and 372.00 September.  Support is at 338.00, 328.00, and 323.00 September, and resistance is at 343.00, 349.00, and 351.00 September.

SUGAR                                                            

General Comments:  Futures closed higher in New York and in London yesterday in sympathy with price action in financial markets.  There just has not been any news to excite the bulls lately, and fundamentals still seem to be more negative than just a few months ago.  Brazil lost Sugar production potential this year due to poor weather, but production in other parts of the world seems strong.  Bears keep pointing to increased supplies around the world and no demand this year from India as reasons to see futures move lower over time.  Chart trends turned up with the price action yesterday. 

Overnight News:  Mostly dry conditions are expected in Brazil.  Temperatures should be near to above normal. 

Chart Trends:  Trends in New York are up with objectives of 3080 and 3310 October.  Support is at 2850, 2835, and 2820 October, and resistance is at 3000, 3030, and 3060 October.  Trends in London are up with objectives of 822.00 and 883.00 October.  Support is at 748.00, 744.00, and 738.00 October, and resistance is at 776.00, 797.00, and 801.00 October.

 

COCOA                                                                 

General Comments:  Futures were higher in New York and in London along with other softs markets.  Cocoa may have found a bottom as futures have already fallen quite a bit since the end of the war and the elections.  However, bears have been unable to push futures to new contract lows in the last few weeks.  Spreads between September and December were noted as positions get rolled forward before September deliveries start Thursday.  Ideas of good supplies from Western Africa keep the selling pressure around, but the region is now between harvests so offers are less.  Trends are still down overall on the charts.  For now there is still no real reason to buy except for a temporary shortage as farmers in many countries wait for prices to rally.  Fundamentals have not really changed.  Ivory Coast and western African selling pressure remains a feature of the market.  Ideas are that current weather patterns in Africa are not good and that production in western Africa can drop next year. 

Overnight News:  Scattered showers and storms are expected in West Africa.  Temperatures will average above normal.  ICE stocks are lower today and are now about 4.043 million bags.  ICE said that Cocoa deliveries are 0 contracts today and now total 0 contracts for the month. 

Chart Trends:  Trends in New York are mixed.  Support is at 2990, 2970, and 2910 September, with resistance at 3090, 3135, and 31145 September.  Trends in London are mixed.  Support is at 1890, 1855, and 1840 September, with resistance at 1920, 1935, and 1975 September.