Cocoa moves higher as demand seen weak

COCOA  

General Comments: Futures closed higher despite ideas of good harvest weather and active movement of beans to ports in western Africa. Reports of dry weather in Ivory Coast that could hurt development supported the market. Internal prices are reported weak in much of Africa on ideas of weak demand. The weather is good in West Africa, with more moderate temperatures and some rains. It is hotter and drier again in Ivory Coast this week, but the rest of the region is in good condition. Ivory Coast is starting to see showers, but will need more rain soon. The mid crop harvest is about over, and less than expected production along with smaller beans is reported. Malaysia and Indonesia crops appear to be in good condition and weather is called favorable.

Overnight News: Scattered showers are expected in West Africa. Temperatures will average near to above normal. Malaysia and Indonesia should see episodes of isolated showers. Temperatures should average near normal. Brazil will get mostly dry conditions and warm temperatures. ICE certified stocks are lower today at 4.873 million bags. ICE said that 23 delivery notices were posted today and that total deliveries for the month are 372 contracts.

Chart Trends: Trends in New York are up with objectives of 2260 September. Support is at 2200, 2170, and 2130 September, with resistance at 2250, 2280, and 2300 September. Trends in London are mixed. Support is at 1440, 1420, and 1360 September, with resistance at 1470, 1490, and 1520 September.

COTTON

General Comments: Futures were higher on follow through buying. It was a low volume session with the holiday yesterday, and today could be a low volume session as well. Futures held the short term range. It is possible that futures can work lower again as demand has turned soft. Ideas of better production conditions in the US caused some selling interest. Texas is reporting light precipitation, mostly in southern areas. Dry weather is being reported in the Delta and showers and storms are seen in the Southeast. The weather should help support crop development in the Delta and Southeast, and could help in Texas. Weather for Cotton appears good in India, Pakistan, and China.

Overnight News: The Delta should be dry and Southeast will see showers and rains. Temperatures will average near to above normal. Texas will be mostly dry. Temperatures will average near to above normal. The USDA spot price is now 82.78 ct/lb. ICE said that certified Cotton stocks are now 0.623 million bales, from 0.623 million yesterday. ICE said that 53 notices were posted today and that total deliveries are now 2,515 contracts. USDA said that net Upland Cotton export sales were 34,.500 bales this year and 41,500 bales next year. Net Pima sales were 2,900 bales this year and 1,700 bales next year

Chart Trends: Trends in Cotton are mixed. Support is at 86.20, 85.20, and 84.00 October, with resistance of 88.00, 88.20, and 89.70 October.

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