Evening Coffee by Societe Generale
After taking out yesterday's high in inactive trading, New York coffee trended lower rest of the session, bottoming out one-quarter hour before the close, nearly five cents from the high - the lowest close in the Mar17 contract since October 7th. Similar action in London, which opened above yesterday's high, but we did not trade below yesterday's low (we settled nine dollars above it). I wouldn't term the action as a Dark Cloud Cover as it comes near the bottom of the market's move, but it is negative action nonetheless.
March New York (KCEH7) settled just over one-half cent from its low, down 3.60¢. Volume was average at an estimated 32,560 lots including an estimated 984 EFP's, 10 EFS's, 310 TAS and 11,339 spreads. 4,175 calls and 3,653 puts also traded. The KCEH7-LRCH7 arbitrage: 61.07¢. Ratio: 1.6182. €: $1.0643+0.3%. BRL: 3.3943/$-¼. CRB: -1.8%. Crude oil: -2.9%. S&P500:+0.4%. Open interest: 186,145-812 (50-day stochastic: 14%; 125-day: 35%).
January London (LRCF7) settled four dollars from its low, down thirty-two dollars. Volume was below average at an estimated 14,613 lots including 3,515 spreads and 597 EFP's and 2,500 May17 EFS's. 1,350 calls and 1,590 puts also traded. Open interest: 106,896+782 (50-day stochastic: 23%; 125-day: 29%).
CFTC reports that Large Hedgers were net buyers of 2,577 lots of Coffee "C" in the week ending November 22nd cutting their net short position to 96,001 lots. Large Speculators sold 2,477 lots, reducing their long position to 49,076 lots. Index Traders sold 383 lots leaving them long 41,145 lots. Non-reportable Traders bought 283 lots and are now long 5,780.
ICE Europe reports that Other Reportable traders were net sellers of 1,982 lots of robusta coffee in the week ending November 22nd cutting their net long position to 1,152 lots. Managed Money bought 1,968 lots increasing their net long position to 31,818 lots. Commercial traders bought 1,030 lots, cutting their shorts to 28,386 lots. Swap Dealers sold 1,022 lots, increasing their short position to 7,636 lots. Non-reportable Traders bought seven lots leaving them long 3,052.
Stevedores and other port workers at the majority of Brazilian ports have planned a 24-hour strike starting tomorrow at 7 am local time to protest changes to Brazilian port regulations and pension programs. Santos workers will decide later on today whether or not to participate.
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