Arabica coffee futures closed with strong gains Wednesday. The firm Robusta market remains as a major factor adding the bullish sentiment. Commercial buying ahead of the first notice day for the May position was significant today. With only two days left commercial price fixing has boosted the market. The contract with the most activity for July delivery ended with gains of 1,120 points or 4.9 % at 240.35 cents a pound. The volume reached 74,220 lots including 22,957 switches. The technical strength attracted speculators and funds buying too as they perceive a situation that could be parallel to that of the cocoa market, which has risen more than 150% this year. In the technical part, previous patterns on the charts, suggest the next objective against the 243/245 area, highs of Sep 2022, and later against 250/260. The market seems to continue disconnected from macro factors such as the weakness of the Brazilian real and the Colombian peso. Certified stocks rose 7,375 bags to 630,856 bags. Those pending certification increased by 1,035 bags for a total of 57,848. Robusta Jul24 contract settled at $4195 +218 with a 4206/3952 range. A new absolute high basis 2nd month, taking out the previous $4,140 high in Sep 1994 (5 MT contract). We are currently facing a financial squeeze on the commercial sector with runaway flat price and a stagnant physical market. This leaves participants unable to get hold of product, and what is available is extremely expensive. Rumours of a very large commercial player buying in the physical space today caused prices to rally (in very large quantities). Shorts continue to cover with the total absence of a natural seller meaning we just trade through vacuums of liquidity. Volumes reached nearly 43k lots total. Robusta Jul24 5000 call traded 1000x @ 65, Robusta Jul24 3800 puts vs 4094Δ30 traded 1250x @ 130.
0 Comments
The Arabica coffee market closed higher today after a highly volatile session. The most active contract for July delivery closed 640 points or 2.9% higher at 226.85 cents a pound. Once again, the strength of Robusta prices drove the rise of the New York “C” marking. In an extension of Friday's action, prices were under selling pressure after the open. Contributing to the bearish sentiment, the COT data released on Friday also influenced the early trading as traders felt that the funds could be overloaded with long positions. The funds' long position has reached record levels of 68,839 lots as last Tuesday as reported by the CFTC in its weekly COT report. The strength of other soft complex raw materials added support. Cocoa remains firm trading above $11,000 per ton. Certified stocks fell by 15,105 bags to 624,545 bags. Pending certification rose by 1,675 bags to 66,079 bags. Today a total of 5,415 bags were graded. 5,130 bags (BR 855, NI 4,275) were approved, while 285 (NI) failed
Robusta Jul24 contract settled at $3949 with a 3975/3805 range. Market was dragged lower in the early part of the session largely down to the selloff in KC which seemed to be a COT reaction if anything. However, as the day progressed, we continued higher with a lot of the early shorts covering push prices higher. Once the US came online, we pushed through the highs and normal service resumed with limited commercial selling absorbing the speculative and roaster buying. Volumes were high with over 16k lots trading on July alone. Structure weakened with May/Jul trading 13/52 range of circa 6k lots. Robusta Jul24 3800/3600 putspread vs 3930Δ12 traded 1100x @ 79, Robusta May24 3500 put traded 1000x @ 1, Robusta CSO May24/Jul24 50 call traded 1000x @ 6 |
|