Daily Coffee Market Outlook

NY- Neutral- The 'C' couldn't quite capitalise on Tuesdays gains yesterday with the board finishing broadly unchanged. However, sentiment does appear to be changing somewhat as traders discuss upside potential rather than the next leg lower. Despite the failure of May to close above 133.50, there is certainly room for further gains if the USD can give the board a helping hand. The next target once 133.5 is convincingly breached lies at 137-138. To the downside, strong support and the lower end of the current sideways trend lies at 130.

Liffe- Sell (1)- Many commentators are beginning to turn slightly bullish of LDN following Tuesdays rally and an improving technical picture. The stockpiling 'rumours' coming out of Vietnam are certainly making shorts think twice. However, yesterday proved just how difficult it is/will be to completely reverse the downward trend- and on an intra-day basis, we still see the prospect of further falls until the stockpiling scheme gains more substance and we see a convincing close above 1280/1300. The target remains for us at 1200 on the downside, but we'd be willing to mark an about turn should things develop in Vietnam.