Evening Coffee by Societe Generale
New York coffee rallied irregularly off of yesterday's lows, retracing much of the
previous day's range while not breaking either of its extremes. We closed near the
day's highs after opening near its lows - positive action technically. The London
market took out yesterday's life-of-contract low by twenty dollars then reversed
direction, finding resistance midway between yesterday's opening and closing levels.
We closed four dollars higher, postponing an RSI buy signal until tomorrow,
presuming we don't close two or more dollars lower. U.S. equities stabilized, crude oil
prices are sharply higher. NY's open interest rose 5,753 lots and is now just 1,484 lots away from the all-time
high of 207,524 lots set last April. The U.S. dollar was mixed except against the Brazilian real, against which if rallied to 3½-month high after an expected interest-rate hike did not materialize.
March New York (KCEH6) settled near its high (92%), up 2.80¢. Volume was
fourteen percent above average at an estimated 32,888 lots including an estimated
663 EFP's, 125 EFS's, 271 TAS and 10,145 spreads. 3,132 calls and 3,551 puts also
traded. The KCEH6-LRCH6 arbitrage: 51.36¢. Ratio: 1.8265. €: $1.0881-0.1%. BRL:
4.1575/$-1½%. CRB: +1.8%. Crude oil: +5.0%. Open interest: 205,770+5,753 (50-day
stochastic: 100%; 125-day: 100%). March London (LRCH6) settled near its low (18%). Volume was fifty-two percent above average at an estimated 22,037 lots including 7,454 spreads and 382 EFP's.
1,200 calls and 3,336 puts also traded. Open interest: 136,510+1,860 (50-daystochastic: 100%; 125-day: 79%). No tenders were posted. Coffee “C” certified stocks fell 26,640 bags to 1,635,139 and are now 1,168,246 bags off the 30-Aug-13 high of 2,803,385 bags.
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