The Softs Review
For the week of December 19, 2011

By Jurgens H. Bauer

For the week coffee prices continued downward, making new lows and looking weak. Cocoa prices staged an early week sizable rally when nervous shorts covered after a private report warned of reduced production slated for the Ivory coast. However, cocoa values resumed their move lower again, although managing slight gains for the week.

Sugar prices consolidated with the key feature being the reduction of volatility in option prices. Cotton prices moved sideways to lower.

What to expect in the week ahead? Anticipate resumption of US Dollar strength to pressure values among softs and for markets to be choppy and vulnerable because they will be thin.

Disclaimer: Past performance is not indicative of future results. Trading futures and options involves substantial risk of loss and is not suitable for all investors. Fundamental factors, seasonal and weather trends, daily news, and other current events may have already been factored into the markets. The use of stop loss or contingent orders may not protect profits and may not limit losses to the amount intended. Certain market conditions make it difficult or impossible to execute such orders.