Dow Jones Report With Mike Zarembski

DJ Nybot FCOJ Review: Profit Taking Knocks Market Off Highs

DOW JONES NEWSWIRES

Frozen concentrate orange juice futures closed firmer but off of
session
highs, as profit taking hit the market late and pressured prices, sources
said.

May FCOJ on the New York Board of Trade gained 60 points to
$1.4665 a pound,
after reaching a new contract and 14-year high of $1.4990 earlier in the
day on
speculative buying.

"Going into the weekend, I think the bulls had this nice
run-up and some of
them decided to take some profits and call it a week," said Mike
Zarembski,
analyst and futures desk manager at XPRESSTRADE in Chicago.

With prices reaching such high levels, speculative as well as
commercial
sales weighed on the market, he said.

Only a late buying spurt kept prices from posting a technical
reversal, which
could have been a bearish development, Zarembski said.

The market has rallied to new highs in a short time, producing
overbought
conditions, and prices may back off a bit before resuming any uptrend.
The
relative strength index, a technical strength indicator, shot to 82 this
week
as the market gained 650 points from last Friday's close. An RSI of 70 or
above
indicates overbought conditions.

Still, Zarembski and others believe the bullish fundamentals will
keep solid
support underneath the market and prices could trade to yet higher
highs.
Traders may target $1.5210 on May juice, a level not seen since December
1991.
If that is achieved, then $1.61 becomes a target, Zarembski said.

Candlestick charts point to a possible long-legged Doji formation
in Friday's
session, which could be a bearish development for the market. However,
traders
may choose to ignore any bearish technical signals such as the Doji or
high RSI
amid the existence of such powerful fundamentals, an analyst said.

A small Florida crop currently estimated at 154 million, 90-pound
boxes is
the main bullish feature of the market, along with spreading
citrus-greening
disease and citrus canker. Dry weather in Florida, projections for
smaller
crops over the next 15 years and forecasts for an active tropical-storm
season
this year also have been supportive for FCOJ prices.

Meanwhile, scattered showers did fall over some Florida growing
areas
Thursday, though amounts were 0.10-0.50 inch, DTN Meteorlogix said. Dry
weather
is expected Friday through Tuesday, with below-normal temperatures
Sunday
through Tuesday.

At the Nybot, FCOJ open interest on Thursday rose 310 to 37,830
positions.

FCOJ futures volume was estimated at 6,404 contracts Friday, with
1,391 calls
and 967 put options traded.