Arabica coffee futures for May delivery settled 20 points lower at 185.00 cents a pound. Ealy liquidation added some pressure on the prices; however, the market was able to bounce as the liquidation eased. A large liquidation of longs on Friday was evidenced as the open interest data showed a decrease of 4,497 lots. Funds began to liquidate long positions after the market reversed the direction last Thursday. The CFTC’s COT data on Friday showed the funds still with a hefty long position as of last Tuesday, however after the recent action the position could have been reduced considerably. Support near 181, the lower level of the Bollinger band discouraged short players to continue adding position. Arabica certified stocks increased by 6,405 bags to 431,157 bags. Pending grading added 5,736 to 177,293 bags. Graded today 12,149 bags. Passed 6,905 BR 4,910, PE 1,995), failed 5,235 ( BR 4,345, IN 320, PE 570 ).
Robusta May24 contract settled at $3279 -18 or 0.55% lower with a 3316/3268 range. A fairly subdued session with no real significant action. An inside day with very little volatility and volumes reflected that, only 5.5K lots traded on the most active May24 contract. Commercials seem to be sitting tight with no notable roaster buying at these levels. Structure saw a similar pattern with May/Jul only managing to trade 1.3k lots between 98/115. Robusta May24 3350/3050 putspread vs 3276Δ34 traded 1500x @ 130. Robusta May24 2700 put traded 500x.
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Arabica Coffee futures main contract May24 settle 700 points lower at 185.20 cents per pound. The NY market ended the week 0.9% higher but 4.9 % below the week's high. The volume was good, almost at par with the previous day's session, totaling today 62,157 lots, including 14,374 switches. Today was Apr24 options expiration and clearly the area of interest laid in the 182.50/185.00 range. Additional factors that played a role this week were traders and the overall market managing US data reports. The dollar index corrected significantly and today was not the exception, making new lows in the early hours before the jobs report and turning around thereafter, this recovery in the dollar sustained the pressure on Arabica coffee after trading below 187. Furthermore, everything seemed to be turning around. Crude oil corrected downward, unable to trade above previous week's highs and the Brazilian Real followed this weakness, trading back at 4.9344. Arabica certified stocks increased by 13,875 bags to 424,752 bags. Pending grading increased 9,277 bags to a total of 171,557 bags. Grading on Friday a total of 24,223 bags: 13,875 passed and 10,348 failed.
COT (CIT) Non-commercials decreased their long position by 264 lots to 54,446 lots long and decreased their short position by 780 lots to 21,804 lots short, with a net long position of 32,642 lots in the week to March 05. The recent strength in Robusta fails to attract a fresh element of buying encouraging long liquidation into the weekend, with values ending the session over 3% lower. A fairly subdued opening saw values hug $3350 basis May through early exchanges, whilst participants awaited fresh buying against the Vietnam undertone which has dominated bullish sentiment. However, values were unable to attract fresh buying and the recent upside momentum diminished naturally drawing the systematic players to the terminal as sellers. With the roasters noted more buy absence levels swiftly breached nearby support at $3329 triggering a wave of speculative liquidation into a vacuum of $100 to $3256 with only a marginal correction observed into the close. |
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