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Morning Softs Report 11/22/17

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General Comments: Cotton was higher again in early trading, but could not hold and closed lower for the day. It was a disappointing day fr bullish traders who had hoped for the market to hold better than it did after the breakout higher on Monday. Trends turned up on the charts on Monday and it looks like a big low has been completed. Speculators are already long. The futures market is watching the harvest roll along and is debating the demand for US and world Cotton. Some traders say that USDA is seriously underestimating demand for the fiber, while the others look to the high USDA ending stocks estimates and suggest that any demand can be easily met. Futures had a muted reaction to the USDA reports and held to the range seen for the last few weeks. Farmers are reported to be quiet sellers right now. Harvest conditions are good in just about all areas.
Overnight News: The Delta and the Southeast should get mostly dry weather today and light showers this weekend. Temperatures should be near to above normal through tomorrow, then near to below normal this weekend and warm again next week. Texas will see mostly dry conditions. Temperatures will be above normal. The USDA average price is now 68.17 ct/lb. ICE said that certified stocks are now 47,951 bales, from 47,951 bales yesterday.
Chart Trends: Trends in Cotton are up with objectives of 7180, 7350, and 7700 December. Support is at 7020, 6950, and 6890 December, with resistance of 7220, 7250, and 7320 December.

General Comments: FCOJ closed mostly a little higher again yesterday as the small crop in Florida impacted the market. Trees in Florida that are still alive now are showing fruit of good sizes, although many have lost a lot of the fruit. Florida producers are actively harvesting what is left as cleanup from the hurricane is about over now. The emphasis is on the fresh fruit market now, with processors mostly getting packing house eliminations at this time.
Overnight News: Florida should get mostly dry weather and near to above normal temperatures. Scattered showers are expected this weekend. Brazil should get mostly dry conditions and near to above normal temperatures. Some showers are possible this weekend. ICE said that 9 notices were posted for delivery today and that total deliveries for the month are now 38 contracts.
Chart Trends: Trends in FCOJ are mixed to up with objectives of 171.00 January. Support is at 163.00, 160.00, and 157.00 January, with resistance at 169.00, 170.00, and 175.00 January.

General Comments: Futures were lower again, but came back and cut losses that were made in the first part of the day. A weaker US Dollar gave some Support to futures. There are some ideas that futures can continue the recovery effort today and perhaps get back the losses made early in the week. Many Arabica traders are expecting the market to move higher due to ideas of smaller crops from all over Latin America, and especially Brazil. Brazil exports are reduced on what is called reduced inventories held by exporters and producers. Producers are less interested in selling as well as the market tries to gauge production potential in Brazil after earlier drought and cold weather hurt trees at and before flowering time. There is plenty of rain now, but dry weather could return soon and stress the trees again There are also reports of short crops in parts of Central America and some areas in South America due to the lack of farmer investment from the low prices. However, supplies in importer countries are called high and are providing a cushion for buyers, and buyers have been able to keep differentials low even with the low prices in futures.
Overnight News: Certified stocks are higher today and are about 1.921 million bags. The ICO composite price is now 116.02 ct/lb. Brazil will get showers and storms this and next week and drier weather this weekend. Temperatures should average near to below normal. Colombia should get scattered to isolated showers. Central America and southern Mexico should get scattered showers or dry conditions. Temperatures should average near to above normal. ICE said that 1,417 delivery notices were posted against December Contracts today and that total deliveries for the month are now 1,498 contracts.
Chart Trends: Trends in New York are down with objectives of 124.00 and 118.00 March. Support is at 125.00, 123.00, and 120.00 March, and resistance is at 129.00, 130.00 and 132.00 March. Trends in London are mixed to up with objectives of 1860 and 1890 January. Support is at 1800, 1770, and 1740 January, and resistance is at 1850, 1880, and 1900 January.

General Comments: Futures were lower in both New York and London again yesterday. Futures have now fallen back into the recent range. Chart patterns are more neutral now due to the weakness in futures as a breakout higher seems to be failing. Brazil features reduced sugarcane crush and continued emphasis on ethanol production and reduced Sugar production as it moves to cover domestic demand at the expense of exports. Trends are turning up in London and in New York after the price action last week on ideas of reduced availability of Sugar to the market. There have been no big demand reports, and the lack of demand against ideas of big world production are keeping the market in a fundamentally bearish mode. Even so, the charts in both New York and London imply that higher prices are still possible
Overnight News: Brazil should feature showers and storms this and next week and drier weather this weekend. Temperatures should be near to above normal today and tomorrow, then near to below normal
Chart Trends: Trends in New York are mixed. Support is at 1480, 1460, and 1430 March, and resistance is at 1520, 1550, and 1580 March. Trends in London are mixed. Support is at 383.00, 380.00, and 377.00 March, and resistance is at 393.00, 396.00, and 399.00 March.

General Comments: Futures closed higher. The charts show that Cocoa futures could hit swing targets with further weakness in prices. London hit its targets yesterday. Some talk of disease in crops in Ivory Coast has created much of the recent buying interest, but no news has been heard to confirm the talk so the fundamental supply side issue faded. It has been unseasonably wet in parts of West Africa, so some diseases could be forming. Demand ideas are holding strong as processor margins have been great. Ivory Coast processing data was strong in a report released Tuesday. World production ideas remain high.
Overnight News: A few isolated showers are expected in West Africa. Temperatures will average near to above normal. Malaysia and Indonesia should see mostly dry conditions. Temperatures should average above normal. Brazil will get scattered showers and near to above normal temperatures. ICE certified stocks are lower today at 3.795 million bags. ICE said that 0 notices were posted for delivery today and that total deliveries for the month are now 116 contracts.
Chart Trends: Trends in New York are down with objectives of 2080 March. Support is at 2070, 2060, and 2030 March, with resistance at 2110, 2150, and 2180 March. Trends in London are down with no objectives. Support is at 1560, 1540, and 1510 March, with resistance at 1600, 1630, and 1650 March.
Questions? Ask Jack Scoville today at 312-264-4322

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The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures. The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author. Trading in futures contracts, options on futures contracts, and forward contracts is not suitable for all investors and involves substantial risks. ©2017

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About the author

Jack Scoville is a futures market analyst specializing in grains, softs, rice, oilseeds, and tropical products such as coffee and sugar.

He offers brokerage services to an international clientele of agricultural producers, processors, exporters, and other professional traders.

Jack writes daily comments of the many products he specializes in, in three languages, English, Spanish, and Portuguese.

He has been quoted by most major wire services including Dow Jones, AP, and Reuters. His comments have also appeared in newspapers around the world and on various radio and television shows.

Jack offers a dedicated and high quality service for his clients. His industry contacts in South America, Europe, Asia, and North America provide him with a unique view of the markets. He also uses his own charting program for technical traders.

Jack began working in the futures industry over 30 years ago and spent 10 years working on the floor of the Chicago Board of Trade in various roles. He has been a broker off the floor since then and has been with The PRICE Futures Group since it was established in 1988.

Contact Jack Scoville: (800) 769-7021 or at

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