Arabica coffee term September 2022 (KCEU22) continued its decline due to currency and seasonal factors, down 9.15 cents (-4.24%), closing price at 206.70 cents/lbs.
So the move to raise EUR interest rate of the ECB is clear, the market continues to watch the Fed’s USD interest rate increase this week, is it exactly as investors expected the 0.75% figure? The USD continued to be favored by money flow to increase again after a few previous downward corrections. The price of coffee on the New York floor had a stronger decline than that of the London floor because the Real had strongly weakened against the USD, 1 USD = 5,499 BRL. This exchange rate triggers the selling momentum of Brazilian coffee producers.
Brazil is still at the peak of the harvest season with the promise of a bumper crop every 2 years and the weather is still quite favorable for harvesting.
According to technical analysis, the 1H frame chart shows that bearish momentum is still there, the daily chart shows neutral signal. The drop at the end of last week wiped out the attempt to gain and recover in the previous sessions. In the context of the market waiting for information about the Fed’s interest rate hike, Arabica price is still in a downtrend, accumulating support in the short term with the near resistance zone at 203-205 and further if it loses the 200 mark again. then it is possible to find the old bottom zone 193-194.
HINTS BUY/SELL STRATEGY IN THE Session (refer).
NEW BUYING CL:
- Support zone 1: 1940-1945 USD,
- Support zone 2: 1930-1935 USD,
- Proportional buy, stop loss $1915.
CL SELL DOWN:
- Resistance level 1: 1980-1985 USD,
- Resistance level 2: 1995-2000 USD,
- Sell proportionally, stop loss 2025 USD.
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