Coffee prices came under pressure with KCZ settling down 185 points at 112.40, as commodity markets took it on the chin, courtesy of the dollar index trading to the brink of 14 month highs. All commodities in the BCOM index save lean hogs and silver were down on the day as sensitivity to interest rates hikes supports the dollar whilst bearing down on the commodity complex. Arabica, true to form, traded more specifically correlated to the BRL as the FX market remains jittery on uncertainty surrounding President-elect Bolsonaro’s intended economic reforms. Open interest increased by 2,511 lots on yesterday’s 540 point sell off in what was likely a mix of new shorts and long liquidation with the bias to the former. Robusta faded $11 settling at 1676 and formed a double bottom at 1669, the high of the 1665-1669 October 5-8th gap.
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