(Rewrites throughout, updates prices; adds comment, NEW YORK dateline)
NEW YORK/LONDON, Feb 26 (Reuters) - Cocoa futures extended gains to three-month highs on Monday, in a volatile session that lifted contracts to technically overbought levels on diminishing crop prospects in top grower Ivory Coast, though profit-taking pressured prices mid-session.
* May New York cocoa settled up $21, or 1 percent, at $2,215 per tonne, having reached $2,220, the highest since Nov. 10.
* This raised the second-position contract near 71 on the relative strength index, the highest since May 2016.
* Prices were supported by concern that hot, dry weather in Ivory Coast could curb production in the world’s top grower, traders said.
* Ivory Coast cocoa exporters said on Monday they were struggling to buy enough beans to satisfy export contracts, after an unexpected drop in deliveries to the top grower’s ports .
* Prices briefly turned negative on profit-taking during the session, traders said.
* “The recent price action has been strong and this may increase the chances of a correction in the coming sessions, back towards $2,155,” Sucden Financial technical analyst Geordie Wilkes said in a market note.
* The bullish move came after data late Friday showed speculators doubled their net long position to a 1-1/2-year high.
* May London cocoa settled up 17 pounds, or 1.1 percent, at 1,564 pounds per tonne after rising to 1,568 pounds, the highest since Nov. 27. The May contract rebounded above the 200-day moving average of 1,526 pounds, the session low.
* On a continuation chart, it reached 72.4 on the relative strength index, marking the most technically overbought level since July 2016.
* May raw sugar settled down 0.03 cent, or 0.2 percent, at 13.43 cents per lb.
* The premium of March rose to an 11-month high at 0.27 cent over May SBH8-K8 ahead of the March contract’s expiry on Wednesday.
* This could indicate some short-term supply tightness, though overall supplies remain ample with a large 2017/18 global surplus widely forecast.
* “Estimates of India’s current crop are now knocking on 29 million tonnes and expectations are for an even bigger crop next year, making India virtually certain to export substantially at some stage in the not-too-distant future,” Marex said in a market update.
* May white sugar settled down $2.50, or 0.7 percent, at $359.40 per tonne.
* May arabica coffee settled up 0.9 cent, or 0.7 percent, at $1.219 per lb, after data showed speculators increased their net short position the prior week.
* May robusta coffee settled down $7, or 0.4 percent, at $1,744 per tonne. (Reporting by Marcy Nicholson in New York and Nigel Hunt in London; Editing by David Goodman, Larry King and Susan Thomas)