Evening Coffee by Societe Generale

New York coffee traded quietly within the upper half of yesterday's extremes in a trading range just over half of the three-month average. A selloff in crude oil and in U.S. equities contributed to the softer tone. The close near the day's lows after opening near its highs is technically negative, but one should wait until we break below the middle of yesterday’s action (118.82¢) before taking action. Next support after that: 116.90¢. Resistance: 121.05¢, 122.10¢.
     May16 London coffee traded below the previous day's low for the fourth straight session, this time closing below it, and at a new life-of-contract low settlement.
     May New York (KCEK6) settled near its low (12%), down 1.35¢. Volume was twenty-seven percent below normal at an estimated 22,891 lots including an estimated 712 EFP's, 9 EFS's, 466 TAS and 6,800 spreads. 2,518 calls and 2,145 puts also traded. The KCEK6-LRCK6 arbitrage: 56.11¢. Ratio: 1.8854. €: $1.1008-0.2%. BRL: 3.9591/$-0.3%. CRB: -1¼%. Crude oil: -4½%. S&P500:-0.80%. Open interest: 182,769+1,589 (50-day stochastic: 44%; 125-day: 44%). 136 tenderable notices were issued bringing the total for the period to 656.
     May London (LRCK6) settled in its bottom quarter (23%), down twenty-one dollars. Volume was forty-six percent above average at an estimated 22,383 lots including 8,893 spreads and 818 EFP's. 620 calls and 250 puts also traded. Open interest: 132,912+203 (50-day stochastic: 62%; 125-day: 73%).
     Uganda exported 334,393 60-kg bags of coffee in January, the Uganda Coffee Developments Authority reports, down slightly from 342,429 bags in December. February exports are forecast to fall ten percent to 300,000 bags, still three percent higher than in January 2015.
     Weather conditions across Brazil's coffee areas during the next week to ten days will be mostly unchanging with frequent rain from Sul de Minas into Parana, but the greatest amounts will be mostly in Parana and southwestern São Paulo. In contrast, precipitation will be minimal in Bahia, northern Minas Gerais and Espirito Santo. - World Weather, Inc.
John Bernardi