LONDON: New York cocoa futures tumbled on Thursday as souring chart signals set off a wave of automatic selling, while raw sugar retreated further from a three-month high after a breach of technical support triggered a sell-off.
COCOA
December New York cocoa fell $67 or 3.2 percent, to $2,056 a tonne by 1456 GMT, after hitting a session low of $2,048.
Dealers said momentum was weakened in recent sessions after prices failed to break through key resistance levels.
"There were significant stops in place for any failure to follow through," said one dealer. "The stops were elected and currency pushed it further."
The dollar strengthened against the British pound, which tumbled after the Bank of England raised interest rates for the first time in more than a decade but said it sees only gradual rises ahead.
Dealers also noted a lack of buying as the industry remains well-supplied.
"There's nothing there in place to stop the fall," the dealer said. "Ultimately, the sellers won the day."
December London cocoa also fell 24 pounds, or 1.5 percent, to 1,547 pounds a tonne, with losses softened by the weaker pound.
Fundamentally, dealers said they were closely monitoring developments in top grower Ivory Coast, where farmers have been reporting disease outbreaks that could dent the next crop.
SUGAR
March raw sugar was down 0.43 cent, or 2.9 percent, at 14.18 cents per lb.
A wave of short covering lifted prices to a three-month high of 14.84 cents in the previous session, but prices began retreating once the rally ran out of steam.
A lack of buying interest and producer selling added pressure on Thursday, pushing the market below the 40-day-moving average and triggering a wave of fund selling, dealers said.
December white sugar fell $6.80, or 1.8 percent, at $375.60 a tonne.
"Most of the exportable (EU) sugars have been/will be priced against the March contract, leaving the December reliant on Central America and Brazil for deliverable sugars," said Nick Penney, senior trader at Sucden Financial.
COFFEE
January robusta coffee rose $27, or 1.5 percent, to $1,865 per tonne, rebounding after prices slumped to their weakest since September 2016 on Wednesday.
The market was partly supported by expectation of rain in Vietnam's key Central Highlands coffee belt over the weekend, which will prevent farmers from harvesting and drying coffee beans.
December arabica coffee gained 2.10 cents, or 1.7 percent, to $1.2505 per lb.
Comments
Comments are closed.