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The coffee market managed to hold support this week (unlike other soft markets) and seems to be in a position to see some upside over the short-term. Traders remain concerned with the potential for a large crop from Brazil this year but the short-term cash fundamentals still look relatively tight and the Brazil harvest does not get going for another few months. Vietnam is in the process of developing their government-backed stockpiling plan which will eventually hold 200,000 tonnes of coffee off of the market and in storage. Producers seem reluctant to sell at lower price levels. Vietnam has exported 522,600 tonnes for the October to February time frame, down 2.4% from last year. May coffee finished higher yesterday, but well within the range of the previous two sessions as weakness in the Dollar helped to support prices. Outside market forces are supportive to the coffee market today with higher gold and energy markets and a weaker US dollar and this may help spark some buying support. Daily ICE certified deliverable coffee stocks were up 2,843 bags to 2.681 million with 33,845 bags pending review.
TODAY’S GUIDANCE: The two-day break failed to do significant technical damage to the coffee market and the base-building process seems to be on-going. A move over 133.90 will be necessary for May coffee to assume a near-term low is in place which will leave 136.90 and 139.60 as upside targets. Support comes in at 131.70 and 130.10.
Coffee Market Commentary – 2010.03.17
by Terry Roggensack on March 17, 2010
Below is a sample of our Daily Commentary. To get this comment, and our daily coverage of 15 additional markets and trade ideas, visit futures-research.com for your free 2 week trial!
The coffee market managed to hold support this week (unlike other soft markets) and seems to be in a position to see some upside over the short-term. Traders remain concerned with the potential for a large crop from Brazil this year but the short-term cash fundamentals still look relatively tight and the Brazil harvest does not get going for another few months. Vietnam is in the process of developing their government-backed stockpiling plan which will eventually hold 200,000 tonnes of coffee off of the market and in storage. Producers seem reluctant to sell at lower price levels. Vietnam has exported 522,600 tonnes for the October to February time frame, down 2.4% from last year. May coffee finished higher yesterday, but well within the range of the previous two sessions as weakness in the Dollar helped to support prices. Outside market forces are supportive to the coffee market today with higher gold and energy markets and a weaker US dollar and this may help spark some buying support. Daily ICE certified deliverable coffee stocks were up 2,843 bags to 2.681 million with 33,845 bags pending review.
TODAY’S GUIDANCE: The two-day break failed to do significant technical damage to the coffee market and the base-building process seems to be on-going. A move over 133.90 will be necessary for May coffee to assume a near-term low is in place which will leave 136.90 and 139.60 as upside targets. Support comes in at 131.70 and 130.10.
Tags: Coffee, Softs
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