The Arabica coffee futures market closed with gains Monday at the end of a highly volatile session in which it traded within a range of more than 13.00 cents. The December contract closed 3.35 cents higher at 223.80 cents a pound. Activity picked up with volume reaching 38,293 contracts, including 7,888 switches. Volatility affected the nearby Dec/Mar too that ended at 7.35 cents after trading between 5.20 to 7.45 cents. An aggressive short-covering rally that found no selling boosted the market up nearly 5% to a high of 232.05 cents. The pessimism as the global economic dims had caused an early selling but failed to generate enough downside momentum. News about Brazil's production data revision by CONAB and rain forecasts for the next days had fueled a bearish sentiment. Certified stocks fell 11,619 bags to 460,387 bags, the lowest level in 23 years. Pending grading remains at 320 bags. There was no grading today.
In London, Robusta futures followed the NY action but in smaller proportion with a more dramatic close marking and outside day down. The November contract settled at $2204 -28 with a 2191/2248 range. As the GBP continues to make new lows today at 103.9, Robusta could also extend to new lows tomorrow probably testing the area around the 50-day moving average today at 2170. Volume was significantly higher than previous week with 17,434 lots traded including 5,390 switches.
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Arabica coffee futures corrected lower Friday by remained inside the recent consolidation range. The December contract settled 310 points lower at 220.45 cents a pound. Volume increased a little but continued weak. A total of 20,065 contracts traded including 3,743 switches. The nearby December -September switch ended steady at 6.35 cents premium. Markets in general fell on concerns about a global recession. The dollar continued to advance with the index posting new fresh two-decade highs. The British pound plummeted to a 37-year low, and the euro to a 20-year low. In Latin America, the real dropped 2%, despite a central bank selling $2.0 billion in FX intervention. The Colombian peso fell near 1.0% as the economic outlook decrease, and investors look for a safe-haven dollar. Arabica prices underwent volatile sessions this week. Daily volumes have declined considerably as commercial activity remains limited as strong differentials and the
backwardation keep commercials away from the “C”. The certs stocks decrease 13,042 bags to 472,006 bags. Pending 320 bags. No grading today. A total of 60,442 bags were withdrawn from the exchange this week. Robusta NOV22 contract settled at $2232 -6 with a 2239/2211 range. Extremely quiet day with a tight range. Much like yesterday we found technical support on the 40-day moving average and resistance at the middle Bollinger band at 2239. Volume was poor with 4.7k lots on NOV22 trading and 1.6k NOV22/JAN23 going through between 11/14. The most excitement from the day was the NOV22 2250/2150 strangle LU traded 750x @ 75. Little commercial activity across the broader commodities basket the whales are getting nervous with US inflation expectations breaking the lowest level in 12 months. |
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