Understanding the #SupplyandDemand (S&D) balance sheet is essential for any professional #trader, but can also be extremely daunting. For many #coffee and #commodity #traders and #analysts, we have a deep insecurity in our relationship to the fundamentals because of its complexity and the extent of the many unknowns. Despite (or perhaps because of) the difficulty of mastering the #SnD, it is a prized skill in our profession and a key driver to price discovery in the #coffeem

Yesterday, #Arabica #certifiedstocks dropped an impressive 70k and the #calendarspreads are going bananas. Calendar spreads in Arabica #coffeemarket are notoriously boring (unlike #Robusta), and yet this year spreads have been ANYTHING BUT BORING. #Spec interest in the spreads has driven a lot of the #bullish #price action there but this has been instigated by some very real #fundamental concerns. In this article, we will look at what the calendar spreads are, why they refl

Like yin and yang, the Law of #Supply and the of Law of #Demand are complementary economic truths: When prices are high, supply increases. When prices are low, demand increases. This is normally reflected in the #COT. When prices rise we see the commercial short position rise and the commercial long position fall. Yet today things don't look quite that way: despite terminal prices of nearly 200 cents/lb, the Commercial short position is barely above average. Let's look at

Given the outsized influence of the #macro bullishness on the #coffeemarket, it is important to revisit this topic. What's concerning to me here is that the #USdollar has continued to weaken, but many of the #commodities have come off quite a bit. Some of this is due to #bearish fundamental news (rains in #wheat for example), but given the synchronized move into a macro #bullish stance, I'm very cautious of a synchronized unwind. In particular, it seems clear to me that the #

With #technicalanalysis for #commoditymarkets, the key is to ask yourself is there a logical, #psychological phenomenon ? With #coffee this week we are seeing two classic examples of "continuation patterns". #Continuationpatterns are typically a consolidation before the #trend continues in the same direction. The logic and psychology behind #consolidation is pretty straightforward. Whenever there is a big move in one direction (the #trend), the appetite for buying or sellin

On 5 Year chart, we have resistance in #KC around the 135-140 level (Jul 2017, Sep 2017, Dec 2019, Aug 2020 and Feb 2021). This psychological barrier is tough to surmount. When there is no crisis, 140 is considered expensive in our collective psyche. Yet since at least May of 2020 we have been recording higher lows. This means that for those #trading #coffee we are consolidating on agreement for the fair price of coffee at consistently higher levels but still below the expens