New York coffee traded steadily lower over its first four-and-one-half hours today pressured by strength in the U.S. dollar particularly versus the British pound against which it traded to a thirty-one-year high. We fell to a five-day low as the dollar rose to a five-day high, finding psychological support at 140¢ in September. We stabilizedat that level although the dollar continued lower for another hour, then rallied as the dollar began a steady decline which took it lower on the day, below the early lows.
Key support in the daily uptrend line starting on June 1st which is at 139.50¢ or 139.20¢ tomorrow, depending on whether you are looking at a logarithmic scale or a normal one.
September New York (KCEU6) settled two-thirds to its high (66%), down 2¼¢. Volume was twenty-four percent below average at an estimated 33,339 lots including an estimated 896 EFP's, 28 EFS's, 1,645 TAS and 8,322 spreads. 5,066 calls and 4,348 puts also traded. The KCEU6-LRCU6 arbitrage: 63.44¢. Ratio: 1.7997. €: $1.1103+¼%. BRL: 3.3231/$-0.6%. CRB: +0.2%. Crude oil: +0.9%. S&P500:+0.2%. Open interest: 176,566+371 (50-day stochastic: 22%; 125-day: 17%).
September London (LRCU6) settled just above the middle (52%), down ten dollars. Volume was forty-three percent below average at an estimated 10,127 lots including 1,623 spreads and 1,757 EFP's. 1,581 calls and 2,430 puts also traded. Open interest: 98,539-936 (50-day stochastic: 10%; 125-day: 4%).
The trade ministry reports that Brazil exported 2.0643 mln 60-kg bags of coffee in June, down 4.8% from 2.3863 mln bags in June 2015. Figures from Cecafé should be released in the next few days.
No precipitation of significance and mild to warm temperatures occurred in Brazil coffee country Tuesday. Similar conditions were expected through the end of next week leaving no risk of crop-threatening coolness. - World Weather, Inc.
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