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CTCS DAILY COFFEE MARKET REPORT – 01/12/2017

1st Dec '17

Market close positions & brief analysis from the previous trading day: 30/11/17.
 
CLOSE - NEW YORK ICE: 
Dec  17 @   C.126.30    ( - 3.30 )
Mar 18 @   C.128.50   ( - 3.70 )
May  18 @  C.130.65  ( - 3.75 )
 
NY ICE Activity: 
Just as momentum appeared to be building for attempts to trade back towards C.140.00, the month end appeared to come a little too early for some as large scale spec, fund & trade based selling, triggering sell stops below C.132.50 on NY ICE Mar’18, allowed values to retrace below the pivotal C.130.00 at the close. We started on the front foot though with early short covering assisting a move above C.132.00, edging on to a high of C.133.00 at where the steadier momentum stalled in light volume late morning. This allowed selling to pressure values lower early afternoon, triggering sell stops at C.132.55 which quickly uncovered C.130.00 and on to an afternoon low at C.128.15 at where it looked as if values might hold. It was not the case, as  fresh fund based selling prompted the session low at C.127.75, eventually closing a busy afternoon back above C.128.00 but well into negative territory once again! Volume was average at just over 38 k lots.       
 
CLOSE - LONDON ICE:  
Nov 17  @   $1793    (  0.00 )
Jan 18   @  $1726    ( - 40.0 )
Mar 18 @ $1724     ( - 35.0 )
 
LONDON ICE Activity:     
Pre-opening sentiment was for a continuation of yesterday’s supportive action and the session started very much as predicted with spec buying prompting the opening on LDN ICE Jan’18 at $1780 (the day’s high) only for light arbitrage selling to counter the steadier move for the balance morning, easing values back below $1760 before mid-day and holding a $1750-60 range into early afternoon. Increased spec selling prompted a move below $1750, triggering sell stops once below $1745, swiftly falling to the day’s low at $1721 at where light trade & industry support propped values into the close, finishing a busy afternoon just above $1725 but back towards recent range lows!  Volume was again very good for London at just over 18k lots.   
 
Analysis: 
Well, after all the speculation of C.140.00 & $1800 possibilities, both markets turn expectation on it’s head with NYC in particular capitulating  on the back of technical (month end) selling and aggressive spec & fund related liquidation. The concern here is not so much the direction these markets have taken today but the swiftness (an willingness) of the decline, apparently eager to return to the bottom picking of last week and back towards recent range lows. As the 90’s pop group “Yazz” once sang…”the only way is up”…well, we’d honestly like to feel that would be the case at present but given today’s sharp fall on both markets and the somewhat unexpected nature of the move, we have to expect further downside pressure to emerge ahead the weekend. We shall see! 
 
Key Currencies         /       Previous Day Close                
£/$ = 1.3518                          (1.3245)
€/$ = 1.1904                          (1.1858)
 

 

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