Arabica coffee futures for December delivery settled 2.05 cents higher at 150.85 cents a pound on Tuesday. After early speculative selling did not have follow through, specs rushed to cover positions . The speculators had sold yesterday too expecting further losses after knowing the COT data that showed a significant reduction in their short position. A good area de support below 148 /147 area added the bullish sentiment. The risk/reward ratio is relatively low for funds to go short at these levels. There are also some concerns about Brazilian weather as well. So far rainfall has not been steady and ample enough to trigger the first widespread flowering that usually occurs by the end of September / beginning of October when rains are more critical. No changes in the certified stocks at 446,518 bags. Pending grading 12,271 bags.
Robusta Nov23 contract settled at $2456 +13 with a 2473/2440 range. Another slow day with flat price seeing a small recovery back towards the 100ma at 2483. Volumes remains low with very little commercial activity. No fresh fundamental news. Robusta Jan24 2650/2250 strangle vs buy 2353Δ14 trades 500x @ 85.
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Arabica coffee futures had a slow-paced session trading range bound until the settlement; additional selling activity was noted thereafter. Short term spec buyers felt the pressure even at the end of the session as new lows triggered stops, the weakness in the Colombian peso and Brazil real diminished any upside momentum. With the weather forecast in Brazil showing improvement in rain, the previous low of 147.20 is not far from reach. Volume continues constant a total of 34,852 lots traded including 8,107 switches. Arabica ICE certified stocks increased 5,665 bags to 446,518 bags. Pending grading decreased from 3,120 bags to 12,271 bags. The total graded today at 5,700, no failed bags.
Robusta Nov23 contract settled at $2443 -18 with a 2488/2441 range. A very dull day with muted activity. Only 5k lots trading on the most active contract in a tight range. A close below key technical levels may prompt further speculative selling over the next few sessions. Robusta seems to be just tracking Arabica in the absence of any new fundamental news and a very slow physical market. Robusta Nov23 2400/2300 putspread trades 1000x @ 24. |
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