Morgan Stanley Coffee Report - February 1'18

KC started out the month of February trading lower, as it has every day thus far this week, settling at 121.40 down .45 points, the same loss as yesterday.  The range was all of 195 points, with today’s bottom at 120.35 being the lowest since the 19th of January and .75 points off of the low for the year..  The lower end of the range since mid- December failed to encourage much fresh activity, and the new low was greeted with a yawn by traders well accustomed to the insatiable propensity for algo funds to short coffee.  The dollar weakened and BRL strengthened yet KC has proven to all but ignore rallies in the Brazilian currency yet trades elastically when the real is under pressure.  At the money option vol in March hovers around 20% as sideways action has encouraged selling premium at either end of the range.  March 120 put was the most active option on the day, changing hands 1,037 times in a .64-1.27 range.   
Volume at 47,857 included 17,277 spreads included 10,905 March spreads traded down the board.