Arabica futures pick up where they left off yesterday, building the short-term support in the 185/186 area as the NY market came into the session accompanying the Robusta early positivity. Further support was found as the dollar index extended the move lower and coffee found buying interest and stops in the 189 area. The main contract MAY24 traded an ample range of 10 cents between 184.75/194.75 on good volume with a total of 69,9678 lots including 19,121 switches and a settle +590 points higher at 192.20 cents a pound. The market awaits US non-farm payrolls numbers tomorrow. Arabica certified stocks increased 18,330 bags to a total of 410,877 bags. Pending grading also increased 815 bags to 162,280 bags. Graded today a total of 21,674 bags: 18,330 passed (10,220 BR, 550 HN, 1,375 MX, 960 PNG, 5,225 PE) and 3,344 failed (275 HN, 319 PNG, 2,750 PE).
The Robusta terminal continues to lead the coffee sector touching new contract highs through the course of the session. Dynamics have not changed as participants weigh ongoing default issues out of Vietnam with offers seen at +800 and many larger players unwilling to sell through the backdrop of uncertainty in the local market. This is naturally encouraging strong upside momentum which draws the speculative community to the terminal as buyers into a vacuum as origin is noted by almost total absence. Technically dynamic as values post bullish confirmation in the form of a secondary settlement above the old key support $3241 basis May24. This was an impulsive move driving values above the upper Bollinger band average whilst slow stochastics show plenty of upside potential. On a purely technical basis you would be long amid comfort with no alerts to change course at this time.
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Arabica coffee futures briefly tested below previous day's lows. The main contract, May24, held the short-term trend that started early last week and found further support in the 183.00 area this week. The May24 contract settled 295 points higher at 186.30 cents a pound. NY market daily activity remained active in a tight range while Robusta took center stage. Arabica's volume was moderate with a total of 31,279 lots, including 8,191 switches. Additional support from a softer US dollar with a stronger Brazilian Real and Colombian peso. Traders and coffee professionals will gather in Nashville this week for the NCA convention as well as in Guatemala for the PRF.
Robusta May24 contract settled at $3,309 with a 3328/3172 range. A new all-time high (10 tonne contract). An impressive flat price rally largely due to the fact there are no natural sellers which is encouraging upside momentum driven by the speculative sector. Stops were triggered through the previous 2nd month continuation high of $3,241 hitting vacuums of liquidity. Structure also rallied with May/Jul seeing a 78/102 range on 3.7k lots. Options continue to be active with highlights below: Robusta Jul24 3100/2900 putspread vs 3195Δ15 traded 2000x @ 77, Robusta CSO Jul24/Sep 70 put traded 2500x @ 32, Robusta CSO May24/Jul 100/50 (1x2) putspread traded 2500x @ 15, Robusta May24 3500 calls vs 3290Δ26 traded 1000x @ 63. |
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