SOFTS-ICE coffee sinks as support breached, Liffe cocoa turns up

* Chart-based selling triggers sell stops in arabica

* Dry weather in Vietnam coffee regions

* Global sugar market remains over supplied

(New throughout, updates prices; adds second byline/dateline, analyst comment) NEW YORK/LONDON, March 5 (Reuters) - Arabica coffee futures on ICE tumbled on Tuesday, turning down from a one-month high and attracting waves of automatic sell orders after breaching support levels, while Liffe cocoa rose from the lowest level in nearly a year. Raw sugar on ICE Futures U.S. nudged higher for the second straight day. The Dow Jones Industrial Average hit a record high to lead global equity markets higher on bets on global growth after China announced record spending this year. Most commodities were also higher, with the Thomson Reuters-Jefferies CRB index, the global benchmark for commodities made up of 19 markets, was up 0.2 percent, having pared earlier gains. ICE May arabica coffee were down 5.40 cents, or 3.7 percent, to $1.4125 per lb by 12:17 p.m. EST (1717 GMT), not far from the 32-month low of $1.3760 hit on Feb. 19. Dealers said a wave of automatic sell orders were triggered when the market breached support at $1.45 and then again at the previous day's session low at $1.4250. "Disappointed longs (started) dumping their positions when we couldn't push through resistance," said one U.S. dealer. Some new longs were noted to have entered the market last week when speculators trimmed their record net short position. The steep fall took the market well below the 61.8 percent Fibonacci retracement level at $1.4635 per lb. The anticipation of another large crop from Brazil in the coming months was also keeping the market on the defensive. "Brazil is set to achieve a coffee harvest that is expected to be record-high for a low-yield year. This is also likely to continue to weigh on prices in the medium term," Commerzbank said in a commodities note. Brazil's arabica coffee crop follows a biennial cycle but the gap between on and off year crops has been narrowing. May robusta coffee futures on Liffe fell $32, or 1.5 percent, to $2,090 a tonne, with losses limited by concerns about dry weather in top grower Vietnam. "Weather forecasts do not suggest any improvement in the situation until April," said Commerzbank. "It remains to be seen whether the 20-25 percent collapse in the harvest feared by growers will actually materialize."

BALANCED COCOA MARKET Cocoa futures on Liffe were slightly higher after rebounding off an 11-month low hit in early trading, on short-covering, dealers said. "The cocoa market has been suffering from weak demand in Europe and a recovery of the supply situation, but the market supply and demand picture right now looks fairly balanced," said Tobias Merath, global head of commodity research at Credit Suisse. "That would indicate this market is closer to a bottom. At current levels we would argue cocoa is trading a bit below fair value." May cocoa on Liffe rose 3 pounds, or 0.2 percent, to settle at 1,391 pounds a tonne, having earlier touched an 11-month low of 1,384 pounds, as improving weather conditions in West Africa aided the development of the mid crop.

May cocoa futures on ICE finished up $3, or 0.2 percent, at $2,059 per tonne, hovering just above Monday's low of $2,053 per tonne, the lowest level since June 2012. Raw sugar futures on ICE were also higher as expectations that Brazil will reduce or remove taxes on fuel ethanol helped to support prices. In a move intended to help Brazil's struggling cane industry, the government plans to exempt fuel ethanol from certain taxes that should be equivalent to between 2 percent and 3 percent of the current pump price, two government sources said on Monday. "The sugar market is still over supplied, there's not a whole lot of reasons to see it a lot higher although there's a floor at one point where the conversion to ethanol kicks in," said Credit Suisse's Merath. May raw sugar futures rose 0.18 cent, or 1.0 percent to 18.26 cents per lb. The front-month contract dipped to 17.61 cents a lb on Thursday, the lowest level since August 2010. May white sugar on Liffe was up $1.70, or 0.3 percent, to $517.30 a tonne.

(Additional reporting by Nigel Hunt in London; editing by Jason Neely and Grant McCool)