Arabica coffee futures trigger scaled stops below 154.00 in the front contract Dec23. The NY market had significant pressure to end the week making new lows, trading back to 150.05, the Volume was constant a total of 34,252 lots traded including 7,754 switches. Brazil's weather forecast showed an increase in rains starting on Wednesday next week. Initial Margin requirements for Arabica Coffee Futures at the ICE Exchange will be reduced from $5,250 per contract to $4,125. Money continued to flow cautiously returning to the commodity and equity sectors overnight following a “risk-off” session on Thursday after the Federal Reserve sounded a hawkish tone on Wednesday afternoon. Arabica ICE certified stocks are unchanged at 440,853 bags. Pending grading at 15,391 bags. COT (CIT) Non-commercials increased long position by 1,604 lots to 32,421 lots long and decreased their short position by 7,805 lots to 48,046 lots short, with a net short position of 15,625 lots in the week to September 19.
Robusta Nov23 contract settled at $2461 -3 with a 2496/2439 range. Robusta remained resilient in the face of a weak Arabica market. It was an extremely quiet session with many participants attending various industry events. Market chopped around key moving averages in a relatively tight range. Commercial activity remained virtually non-existent with small roaster buying noted scale down. Structure strengthened a touch with Nov/Jan seeing an 84/100 range on 2.4k lots. Settling at 94 +8. No notable options traded.
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Arabica Coffee futures extended lower, pressured by a macro risk off sentiment and fundamental production estimates. Today, the US, Europe and Asia administered yesterday’s news, where the US FED mentioned that interest rates should stay high for longer and that one more rate hike before the end of year should not be discarded. Additionally, hawkish weekly jobless numbers propel the dollar above ten-month highs. Brazilian Conab agency also weighed on the market with a slightly lowered 2023 crop forecast, but an increased Arabica estimate from 37.9 million bags in May to 38.16 million bags yesterday. Brazil's weather forecast continues to show high temperatures and dry weather with possible showers for the end of the month. Arabica ICE certified stocks are unchanged at 440,853 bags. Pending grading increased to 2,560 bags, now at 15,391 bags.
Robusta Nov23 contract settled at $2464 -44 with a 2515/2455 range. Flat price continues its recent pullback dragged lower by the sell-off in KC. We find ourselves coming back to test key support areas on the 100ma and 40ma 2481/2468, short-term specs are liquidating longs and looking to flip these to short positions in anticipation of a break lower. The 2350/2550 range remains intact. Nov/Jan softens for the fourth day with another volatile day seeing an 85/106 range on 2.1k lots, settling at 87. Commercial activity remains very light on both sides of the fence. No notable option trades. |
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