Arabica Coffee Settles Higher
ICE Arabica coffee futures ended firm on Tuesday at the end of a very volatile session. The forecasts of a cold front that would reach the producing areas over the weekend raised some concern among short players who had added positions after the weakness shown in the previous two days. The contract for September delivery closed up 475 points at 214.65 cents a pound. Industry buying also helped to add support to the market. The volume reached 48,973 contracts including 14,470 switches. Good volume of rolls ahead of the FND was observed. The move accelerated as prices broke above the 215 level, triggering stop orders and option-related buying. The open interest of the September calls, which expire next Friday 12th, exceeds 7,000 between 220 and 230, generating resistance for the moment. Certificates fell 4,870 bags to 695,135 bags. Pending continue at zero. Robusta remains in the top range of the last five sessions and mirroring arabicas activity while consolidating near the top Bollinger band. Today Robusta tested the high of the week for a second time unable to break the 2056 level opted to settle near unchanged. The most active contract for delivery in September settle 1 point lower at 2026. The switch Sep22/Nov22 settle at +3. The 20 day moving average seems to be turning up but with the market walking the line of overbought territory on the stochastics, the consolidation could continue for the remaining of the week. Fridays NFP release expected +250k and unemployment at 3.6%.
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Arabica Coffee Futures End Lower
Arabica coffee futures for September delivery settled 70 points lower at 218.40 cents a pound. Activity was light and mostly dominated by short term specs looking for some volatility. Commercial participation was limited. Volume reached 32,000 lots, including 9,543 switches. News that the U.S. economy contracted for a second quarter in a row, added some bearish tone to the markets early. Coffee bounced after the spec selling eased and the prices got support near the 214-price level for the September contract. Dealers continued concerned with the dry weather in Brazil that could affect the 2023 /2024 crop. The Latin American equities and currencies rallied as a less aggressive FED interest hikes could be possible following today’s GDP figure. The real recovered to BRL 5.1990, the high of the last 30 days, and the Colombian peso to COP 4,361. Certs stocks down 285 bags to 700,050 bags. No pending grading were reported. Robusta SEP22 contract settled at $2015 +6 with a 1994/2028 range. Flat price managed to break yesterday’s high going on to test the 40-day moving average and the upper Bollinger band both at $2028 (high). Technical selling was seen around these levels causing flat price to soften back to the settlement area. Volume was looking healthier today at 8.2k lots on the most active contract with just over 3k lots of sep/nov switches changing hands between 0 and 5. The Nov/Jan 40/0 fence CSO traded again today 1500x @ 8 adding to the 1000x lots that traded yesterday. The biggest option clip on the day was the Nov22 2100 calls LU trading 1700x @ 64. |
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