The path remains unbroken as the Arabica market rallied to close above $1.50 for the first time since the 20th of February 2015. The paper flows remain largely speculatively driven as system and macro related funds probe the market higher while short term specs and bits of pieces of origin show up on the sell side. The last two times the market traded in the 150-160 range proved to be something of a trading abyss. In February 2014 when prices broke out to the upside on drought concerns, 2 days were spent exploring the 150-160 levels. It wasn’t until a year later that we traded back below 160, and in 4 days time, we broke 150. Now, 17 months later we again close above. There’s an adage in the coffee market that when very little time is spent trading in a particular range the market will revisit for greater price discovery; perhaps this is one of those times. Be mindful of the gap below from 14435-14505.
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