What’s Up, What’s Down: Focus on Softs

Comments for Thursday, February 18, 2010

Looking Ahead to Today by Reflecting Back at Wednesday’s Price Action


LUMBER: Lumber closed higher off the housing starts report and is now in a small BULL PENNANT. It should still test its highs on the 5th of February.

Lumber Chart

COCOA: Cocoa made its highest high in seven trading days before selling off to close lower which I consider bearish action while still in a resistance area. There is more resistance around the 330 area and support around 300 basis the May contract with my sell signal still looking okay.

Cocoa Chart

SUGAR: Sugar closed sharply lower setting up for a huge break. However, I still don’t have sell signal at this time. Sugar has been basically falling since its reversal type action on February 1st.

Sugar Chart

COTTON: Cotton settled slightly lower now in a small BULL PENNANT still at the upper end of a good resistance area. The long term trend is still higher overall with a close over 7600 imperative for the bulls.

Cotton Chart

COFFEE: Coffee settled lower this time still needing to hold the 13000 area basis the March contract while there is heavy resistance over 13500. Coffee has also been making lower highs and lows since the middle of December. Finally, if you’re a bull there is a DOUBLE BOTTOM at 12850(Mar. contract) to give you hope.

Coffee Chart

ORANGE JUICE: OJ settled slightly lower while consolidating over the last couple of months. My buy signal is still good because the long-term trend is still up but keep an eye on the 13000 level basis the March contract.

Orange Juice Chart

Read the balance of my morning comments, including the Metals, Softs, Energies and Grains, at my website. For my complete coverage, visit my commentary page at www.markethead.com.

Rick Alexander has been a broker and analyst in the futures business for over thirty years. He is a Vice-President for Sales and Trading at the Zaner Group (www.zaner.com) a Chicago-based futures brokerage firm. If you would like a free booklet explaining the charts mentioned above, email Rick at ralexander@zaner.com.

The information in this Report and the opinions expressed are subject to change without notice. Neither the information nor any opinion expressed constitutes a solicitation by Rick Alexander or the Zaner Group of the purchase or sale of any futures or options. Futures and options trading is speculative in nature and involves risks. Spread trading is not necessarily less risky than outright positions. Futures and options trading is not suitable for all investors.

FREE 7 day trial to any TradingMarkets stock or ETF trading services! Based on quantified, backtested trading strategies, get your free 7 day trial today – Click Here.