Arabica coffee term 03/2023 (KCEH23), the price of 2 coffee floors still remained green, up 1.55 cents (+0.92%), closing price at 169.35 cents/lbs.
Ending the session yesterday, the dollar rebounded as the US consumer confidence index in December increased to 108.3 from 101.4 previously, largely thanks to the market’s expectation that inflation will cool down and thanks to the positive impact from the rising US Treasury yield curve. The DXY index ended the session up 0.25% to 104,232, however coffee prices increased thanks to the benefit of the report of lower global coffee exports. The Brazilian Real is trading around 1 USD = 5.2012 BRL. This exchange rate restrains the selling momentum of producers, contributing positively to the increase in Arabica coffee prices.
According to the International Coffee Organization’s (ICO) November Trade report for the 12 months ending October 2022, exports of Arabica coffee totaled 90.54 million bags, a decrease of 2.0%. , has supported the price increase of Arabica coffee. In addition, according to data reported by Safras & Mercado, producers in Brazil have so far sold 71% of coffee production in the 2022/2023 crop, or 40.84 million bags, of the total estimated production. 57.3 million bags, slightly higher than the 5-year average of about 69%.
According to technical analysis, RSI is at the average level, MACD shows bullish momentum signal. It is expected that in the short term, Arabica price may increase to detect resistance with the near-term target at the psychological resistance level of 170 and MA50 from 174 to 175, on the contrary, 160-162 is the near support area of the price.
HINTS BUY/SELL STRATEGY IN THE Session (refer).
NEW BUYING CL:
- Support zone 1: 167.5 – 168 cents
- Support zone 2: 165.5 – 166 cents
- Stop Loss: 164 cents
CL SELL DOWN:
- Resistance zone 1: 170.5 – 171 cents
- Resistance zone 2: 172 – 172.5 cents
- Stop Loss: 174 cents
