Markets turn on payroll data that doesn’t live up to hype

Meats:

October cattle (CME:LCV13) closed at $1.2570 per pound on Friday, up 47.5 points against the weak dollar. Cattle prices have been under pressure tied to demand and supplies. We prefer the sidelines. October hogs closed at 90.825c per pound, up 142.5 points on shortcovering tied to the shortfall in market ready animals. We could see further buying, but we prefer the sidelines.

Coffee, Cocoa and Sugar:

December coffee (NYBOT:KCZ13) closed at $1.1745 per pound on Friday, up 60 points on pre-weekend shortcovering and against the weak U.S. dollar. Coffee traded at four-year lows trading down to $1.1525. The continued lows for the Brazilian real have prompted heavy movement by farmers. We may have seen the worst for the real and that could prompt further shortcovering in coffee. We would add a few calls here. December cocoa (NYBOT:CCZ13) closed Friday at $2,559 per tonne, down $8.00. Some shortcovering recently tied to the World Bank project to support cocoa farmers. We prefer the sidelines. October sugar (NYBOT:SBV13) closed at 16.79c per pound, up 28 points tied to technical support and ideas of a bottoming formation. We prefer the sidelines until fresh fundamentals support those ideas of support.

Cotton:

October cotton (NYBOT:CTV13) closed at 83.10c per pound, up 70 points on dollar weakness. Recent selling tied to oversupply and good crops in the U.S. and globally. We prefer the sidelines for now.

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About the Author
John Caiazzo

John has over 40 years experience at major U.S. Brokerage firms as Manager and Director of various International Divisions and is the founder of his own trading and brokerage firms. Over the years John has gained a wealth of knowledge and experience in all aspects of investments and trading. He was also a floor trader at the Commodity Exchange in New York. He formed Acuvest in 1999 and can be reached at futures@acuvest.com.

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