Raw sugar futures made their weakest move in 11 months and sank more than 5 percent on Friday as a flurry of technical sell signals knocked out a week-long rally, while New York cocoa had its poorest weekly performance in more than three months. Volume was heavy in both markets. Arabica coffee firmed after briefly nudging down to the lowest point since July 2014 on forecasts for more rain in parts of top-grower Brazil's coffee belt.
Raw sugar futures fell to their session low in early New York trade in a 50-point slide within one minute of falling below the 100-day moving average and of a 50 percent Fibonacci retracement to the January 5 low from the October 9 high. Sell-stops triggered heavy selling that took the benchmark contract below the 61.8 percent Fibonacci retracement level and the 50-day moving average. This followed a 9.5 percent rally over six sessions to a two-month high on Wednesday.
"Now that the scared shorts have covered, it was just a vacuum down," said David Martin, founder and managing member of Martin Fund Management in New York. March raw sugar closed down 0.74 cent, or 4.7 percent, at 15.17 cents a lb, just above the session low of 15.08 cents a lb. March white sugar ended down $14.50, or 3.6 percent, at $393.40 a tonne. New York cocoa fell for a sixth straight day to a one-year low, closing the week down 6.4 percent after Asia's weak quarterly grind data added to a recent wave of bearish fundamental news.
New York March cocoa closed down $46, or 1.6 percent, at $2,755 per tonne, just above the session low of $2,754 per tonne, the lowest for the spot contact since January 2014. The March contract extended losses below the 50 percent Fibonacci retracement from the contract lows. London May cocoa ended down 23 pounds, or 1.2 percent, at 1,916 pounds per tonne. March arabica coffee turned higher in average volume. ICE March arabica futures settled up 2.5 cents, or 1.6 percent, at $1.6245 per lb, after touching the lowest level since July at $1.5940. March robusta coffee finished down $10, or 0.5 percent, at $1,931 a tonne.