Choppy Lower Trade For Cotton
The technical action remains negative and the cotton market looks vulnerable to remain in a short-term downtrend. However, the market is in an oversold condition, and the market still faces positive outside market forces. July cotton closed sharply lower on Thursday, after an outside day down the threatened to take out the previous week’s three-month low.
The cocoa market has been weighed down during March and for much of the first quarter by ongoing concern over global demand. For the week, May cocoa finished with a loss of 66 points which was a fourth negative weekly result over the past 5 weeks. A rally in US equity markets as well as recovery moves by the Eurocurrency and British Pound provided cocoa with carryover support as they may help to shore up near-term demand prospects in Europe and North America.
While coffee went into the holiday weekend on a downbeat note, the market continues to find some support from bullish supply-side developments. While near-term demand remains subdued, the longer-term outlook is positive which can help coffee hold its ground. For the week, May coffee finished with a loss of 6.90 cents which was a fourth negative daily result over the past 5 weeks.
Sugar has received some support from key outside markets over the past 2 1/2 weeks, but that has not been enough for prices to find their footing. For the week, May sugar finished with a loss of 48 ticks which was a sixth negative weekly result in a row. The Brazilian currency lost more than 1.2% in value after reaching a new 1-week high, and that pressured sugar prices going into the holiday weekend.
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