january 12, 2022.
Arabica coffee futures closed higher today on speculative short covering. The most active contract for March delivery settled 550 points higher at 149.40. A significant increase of the open interest on the previous session, evidenced the amount of new short players added, that were forced to cover as prices rally today. The OI increased 10,219 contracts to 220,388 contracts. The market was poised for a correction to the upside as oscillators showed a market heavily oversold. Additionally, today, the US dollar weakened against most major currencies, including those in Latin America after the US labor department reported consumer prices fell for the first time in more than 2 ½ years in December, suggesting inflation is sustaining a down trend. The real of Brazil recovered to BRL 5.07 , the highest since Nov 7. The market will be closed Monday in observance of the M. Luther King Jr. Holiday. On Tuesday, the GCA US stocks report at the end of December will be published. Certified stocks decreased 4,823bags to 845,578 bags. Those pending certification are at 155,445 bags. Grading today: 14,479 bags 2,698 passed and 11,881 failed.
The Robusta terminal holds key support to end the session 4% higher, help by firm roaster buying observed at the lower end of the day’s range and easing non-commercial pressure. London opened marginally higher at $1817 responding to a mildly positive early macro environment, with traders expecting cooler U.S. inflation data that could prompt the Fed to slow its tightening cycle. Following a brief holding pattern values reengaged the upside as heavy roaster buying prompted a wave of speculative short covering drove values through resistance at $1856 with upside momentum unchallenged until Asian based selling materialised above $1875 so the pace into the closing bell.
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