Cocoa steady, sit and hold. Cocoa has had another day in a narrow range above the 200 day moving average which is a good sign. I could not say the candle from the 5th of February was a classic doji but it is at the end of a long rally so I think the only strategy from here is to sit and hold if you are already long or try to go long from around these levels knowing that the price will likely come back to confirm the break of the 200 day moving average at some point in the next month or so. The million dollar question is where will the 200 day moving average be at that time. If you do not already have a long position it depends on whether your stops will allow you to go long from levels around 2050 because you want to at least have your stop below 2000. For me that's ok because I usually will have a 100 to 150 point stop because I'm expecting a move of around 300 to 400 points. I'm already long from around 1850 and added another unit on the break around 2020. If you were only going to put on your first unit now then maybe wait till the price comes back to the low 2000's with say and 80 Point stop and initial Target around 2200. When I say whether your stops will allow you to have a 100 points. You need to do the calculation of what dollar loss that would translate into and in turn what the dollar loss represent in terms of your overall account. If you are using futures it will be a known amount based on the contracts and if you are using cfd's then you will need to work backwards from the margin requirements and your position size.
Cotton - still some more room on the downside. Still feels like there is some more room on the downside in Cotton, at least into the 50-61.3% retracement of the last run up shown in the picture. Might go further back to the 200 Day Moving Average but for the moment definitely not a time to take a position either long or short.
For the record, I was long MW H18/K18 since 11/06/17@ -7.5( I must have forgot to post ...). Exited today @ -11.5.My only loss so far in my wheat "crop", I am sitting on large MTM gains on -MWH18+2*KWH18-ZWH18 and KWN18-ZWN18.
By the way, if you think about it, on HRS, we went from a tremendous weather scare market in the spring to an almost full carry market now...
Cocoa still seems to be trending higher from the mid-December lows and might once again pull back towards that trendline which is somewhere in the vicinity of 1970 for Wednesday's session in the US. If the break was any more meaningful than that say it drop back towards 1950 then that would definitely be a cause for concern. I would probably consider exiting if it did that all in one session and closed near the lows.
Sugar posts a doji, but the Dollar rallied... i'm sitting tight. Sugar posted a doji candle yesterday after 3 positive days which is not a great sign this early in the rally I probably would have expected more momentum ahead of the 200 day moving average. On the positive side the US dollar has been strong on a safe haven rally so possibly what could be said is that the natural sellers were met and at least held. Just going to sit tight for now and watch what happens next if there is a big down candle tomorrow then that will be a very bad sign for the trade and I would probably consider exiting if the short term trend from the 18th of January was breached. On the flip side if we were able to close above 14.00 then I would see the price heading towards the 14.70 area in the next 4 or 5 sessions.
Long KC May18 @ 125.35( again ) -ICO just predicted deficit for 2017/2018 -Spreads trending -Specs heavily short