The New York coffee “C” market closed lower for second consecutive session as spec liquidation continued. The active contract for September delivery settled 295 points lower at 153.25 cents a pound. The volume of transactions declined as the July position approaches the FND next Tuesday June 22nd. The active
July / September switch has been trading steady inside a narrow range, disappointing participants that were expecting more volatility. The market fell under the spec selling, as the weak technical outlook discouraged bargain buyers for the moment. After the breach of the long-term trend, prices need more development to define a corrective move or a change of trend pattern. For the September contract, support now is at 151/150 area and resistance is at 159 /160. The weather in Brazil began to turn cold. Some areas of Minas Gerais registered temp of 4 C. No frost is expected for the next 6-10 days period. US Green coffee stocks rise by 52,571 bags to 5,815 138 bags at the end of May. Last year GCA Stocks increased by 300,253 to 6,818,120 bags. The five-year average variation is an increment of 197,000 bags and a level of 6,645,049 bags. Robusta settled at $1600 per ton up $4 ref Sep, Market held the previous day low at $1581 finding resistance at the 8-day moving average closing slightly positive as oppose to Arabica. Unable to continue yesterday downtrend market finds itself in a tide range between the 20 day moving average as support and the 8 day moving average as resistance with levels of 1579 and 1607 respectively. Volume was light with 13,795 lots including 4,311 switches.
0 Comments
Arabica coffee futures for September delivery settled 120 points lower at 159.60 cents a pound on general decline of the equity and commodity markets. Activity continued to be boosted by spreads trading. Volume reached 79,511 lots, including 25,497 switches. The commodity complex was affected by the strengthened of
the dollar, after investors factored the inflation figures as temporary and not affecting the FED policies. The Brazil’s real weakened to BRL5.11, adding pressure on the coffee prices. According with local sources, Brazil’s producers have sold 40 % of his year year average of 26%. Higher prices in international and the local market have contributed to induce farmers to accelerate the sales of this year crop, even establishing forward contracts up to 2023. Exports during May fell 20 % to 2.34 million 60-kg bags from May 2020. Lack of containers affected the normal flow, Cecafe said. Participants will focus on next week GCA US stocks report to be published on Tuesday. A subdued end to the trading week as values held the previous low but were unable build significant intraday gains, ending the session only 0.5% higher. This saw july21 management take centre stage as the commercial short were consistent buyers of spot structure sub $27 discount. Technically the market it’s trying to form a baseline at $1600 basis Sep21 as longer-term upside dynamics remain intact. Heavy options volume registered with 1,500 Sep21 1525/1425 put spread versus a 18% delta hedge at $1612 trading at $24. This is most likely the non-commercial long willing to pay out premium to protect downside exposure amid delta management. |
|