ICE and LIFFE Coffee Commodities NEWEDGE RESEARCH 8 February 2010 VĂŠronique Lashinski, CMT Technical Analysis +1 312 756 1562
May ICE Arabica (KCAK0) Coffee: KCAK0 is trending lower. As long as it remains under the median Bollinger line, the medium-term outlook will be bearish. Before that, first resistance is 135, and a close above 135 will signal a short-term corrective bounce, with a potential test of the median Bollinger band.
veronique.lashinski@newedgegroup.com
Invalidation: A close above the median Bollinger line would compromise the downtrend. Re-evaluation would be needed.
May LIFFE Robusta (LRCK0) Coffee: today’s hammer candlestick points to a short-term corrective bounce, towards 1355-1365. In the medium-term meanwhile, LRCK0 is trending lower, within a descending channel.
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In this report: ICE Arabica, daily chart
2
ICE Arabica, weekly chart
2
ICE Arabica, May / July 10 spread, daily chart
2
LIFFE Robusta, daily chart
3
LIFFE Robusta, May / July 10 spread, daily chart
3
US Dollar / Brazilian Real
3
Forward curves
4
ICE Dollar Index, weekly chart
4
Technical numbers
5
ICE and LIFFE Coffee
8 February 2010
Daily chart, ICE Arabica, May (KCAK0): KCAK0 is trending lower. As long as it remains under the median Bollinger line, the medium-term outlook will be bearish. Before that, first resistance is 135, and a close above 135 will signal a short-term corrective bounce, with a potential test of the median Bollinger band. Invalidation: A close above the median Bollinger line would compromise the downtrend. Re-evaluation would be needed.
ICE Arabica, weekly front month continuation (rolled 20 days prior to expiry): Uptrend broken. The underlying trend is now down.
ICE Arabica, Spread May / July 10, daily chart, : The spread is trending lower. As long as it remains under –1.30, it is positioned to decline to challenge support at –1.70.
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ICE and LIFFE Coffee
8 February 2010
Daily chart, LIFFE Robusta, May (LRCK0): today’s hammer candlestick points to a short-term corrective bounce, towards 1355-1365. In the medium-term, LRCK0 is trending lower, within a descending channel.
Daily chart, spread, LIFFE Robusta, May 10 / July 10 : The spread is trending sideways, within a –26 / -31 range. A close either above –24 or below— 32 is needed to point to a breakout of the range.
USD/ BRL, daily: The pair is forming a potential double top under 1.8969. As long as it remains under that level, support at 1.8176 is at risk. Then, a close below 1.8176 would activate the pattern and point to a 0.075-decline. Invalidation: a close above 1.90 would signal the immediate resumption of the rise and a test of 1.9213.
Source: Bloomberg
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ICE and LIFFE Coffee
Forward curve, ICE Arabica: The curve is lower, but its overall shape changed little over the past week.
8 February 2010
Today — Week ago — Month ago—
Source: Bloomberg
Forward curve, LIFFE Robusta: The curve is lower, both on the week and on the month.
Today — Week ago — Month ago—
Source: Bloomberg
ICE Dollar Index, weekly continuation: The Dollar Index is trending dynamically higher, between the median and the higher Bollinger bands. The RSI is consistent with an uptrend. As long as it remains above the median Bollinger line, the Index will be positioned to challenge 81.80, then the 50% retracement in the vicinity of 82.00. Continued strength in the Dollar index will weigh down commodities priced in that currency, which includes ICE and LIFFE Coffee. Invalidation: a close $1 below the median Bollinger band would be bearish.
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ICE and LIFFE Coffee ICE Arabica Coffee Last available KCAK0 Moving averages 5 Day Moving Avg 10 Day Moving Avg 100 Day Moving Avg Ichimoku Kinko Hyo Senkou Span B Senkou Span A Chikou Span Directional system +DMI - DMI 14 day ADX Oscillators 14 Day RSI 13-26-9 MACD MACD (signal line) 8 day S. Stoch. % K 8 day S. Stoch. % D Bollinger Band: Bollinger band (top) Bollinger band (low) %B BandWidth LIFFE Robusta Coffee Current Price LRCK0 Moving averages 5 Day Moving Avg 10 Day Moving Avg 100 Day Moving Avg Ichimoku Kinko Hyo Senkou Span B Senkou Span A Chikou Span Directional system +DMI - DMI 14 day ADX Oscillators 14 Day RSI 13-26-9 MACD MACD (signal line) 8 day S. Stoch. % K 8 day S. Stoch. % D Bollinger Band: Bollinger band (top) Bollinger band (low) %B BandWidth
8 February 2010
132.45 133.67 134.68 141.24
20 Day M.A. 40 Day M.A. 200 Day M.A.
138.98 142.01 137.22
Short-Term: down Medium-Term: down
143.00 142.61 132.45
Tenkan Sen Kijun Sen
134.10 139.53
The market is below key medium-term resistance at the cloud.
13.37 28.00 22.36
neutral
36.27 -255.02 -187.09 17.05 16.48
The % K is above % D, and is rising. This points to higher prices.
oversold
148.76 129.19 0.17 0.14
The market is between the 20-day MA and the lower band: this is a bearish feature.
1330.00 Net change
0.00
1346.60 20 Day M.A. 1355.70 40 Day M.A. 1437.04 200 Day M.A.
1378.65 1386.05 1479.99
Short-Term: down Medium-Term: down Long-Term: down
1438.50 Tenkan Sen 1387.25 Kijun Sen 1330.00
1345.00 1379.00
The market is under key medium-term resistance at the cloud.
14.51 32.00 20.33
neutral
35.15 -14.95 -10.57 17.66 17.92 1437.50 1319.80 0.09 0.09
oversold The market is between the 20-day MA and the lower band: this is a bearish feature.
Source: Newedge and CQG Commodity Research Page 5
ICE and LIFFE Coffee
8 February 2010
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Date of Issue: February 8, 2010 © Newedge USA, LLC - February 10 All rights reserved.
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