Arabica coffee term September 2022 (KCEU22) continued to weaken, down 2.75 cents (-1.26%), closing price at 214.70 cents/lbs.
The price of Arabica coffee yesterday was under selling pressure partly because the US dollar continued to appreciate against a basket of currencies and commodities, largely due to inventory supply. Investors still took shelter in the USD when the market changed their opinion, betting on the rate of the Fed’s rate increase at 0.5% higher than the increase of 0.75% (ratio 65-35). The Real decreased slightly by 0.07% against the USD, 1 USD = 5.1710 BRL.
The level of ICE-qualified coffee inventories is still increasing when the inventory from Europe to North America is being tested for floor quality. With a record increase of more than 4,100 bags on August 17, reaching 581,342 bags. Weather models show that temperatures in coffee growing areas will drop in the coming days, but frost formation is less likely.
According to technical analysis, in the short term, the technical indicators show neutral signals, the price is still struggling sideways in the range of 210-230. However, MACD is converging downward, so it is likely that in the short term, the price will drop to find support. The zone 208-210 is a hard support in the short term for Arabica price, further away from the psychological resistance level of 200. On the other hand, the price needs to surpass the 230 level to attract strong buying force from the buyers.
HINTS BUY/SELL STRATEGY IN THE Session (refer).
NEW BUYING CL:
- Support zone 1: 212 – 212.5 cents
- Support zone 2: 210-210.5 cents
- Stop Loss: 206 cents
CL SELL DOWN:
- Resistance zone 1: 219.5 – 220 cents
- Resistance zone 2: 225-225.5 cents
- Stop Loss: 228 cents
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