Daily Coffee Market Outlook

NY- Neutral- The 'C' continues to be dictated by the whims of the greenback and yesterday was no exception. With the macro picture driving things, todays US housing data could be important; otherwise, very little else to report with May continuing to range between the 130 lower border and 135 supply point. We expect much of the same today and thus remain neutral. A breach of either border is needed for any sustainable developments in NY.

Liffe- Buy (1)- Despite predictions to the contrary, LDN is stubbornly hanging around the 1380 level in anticipation of a possible move to the upside. Origin selling has not shown itself despite the steady grind upwards and LDN has remained remarkably resilient to the movements of the USD hinting at further gains to come. Last weeks performance and continuation yesterday will have bouyed the technical outlook and thus we look for more gains today. 1300 appears to be the key upside level with 1280 providing interim resistance; with both levels breached we see little to stop a charge towards 1340. Conversely, a afilure at 1280 and slide downwards today will leave support at 1250 exposed once more.

Daily Coffee Market Outlook

NY- Neutral- The backdrop of a stronger dollar accross nearly all the majors sent NY tumbling on Friday as recent spec longs liquidated and origin joined in the selling. Of late, its seems every time the board makes a sustainable move upwards, it comes crashing back to reality, in effect, mirroring developments in the global macro recovery. While May is trapped in the 130-135 consolidation zone we choose to remain neutral; action is likely to remain muted until later in the week with US retail sales on Thursday and GDP/Univ. Michigan Sentiment indicator Friday.

Liffe- Sell (1)- Despite clawing back some recent losses last week, LDN was unable to make a sustainable break above 1280/1300. Friday saw the market capped due to a resurgent USD and lack of any really 'big' players going long has ensured gains have not been dramatic. Following the failure to breach 1280, we see the prospect of losses likely, ad watch for spec liquidation below 1250. 1200 remains the bear target to the downside and should provide some semblance of support. 1280/1300 remain the supply points.

Daily Coffee Market Outlook

NY- Neutral- NY remains rangebound between the 130 and 133.50 levels. Following last nights FOMC meeting and subsequent pledge to keep rates low, we see the prospect of small gains accross commodity indexes; however, the impact in the 'C' should be relatively muted and with no fresh fundamental coffee data the range in May should remain intact. To the upside, should the 135 area be challenged, this could elicit short covering and trigger stops to 137/138- but don't hold your breath.

Liffe- Neutral- Like NY, LDN appears to be stuck in a range between the 1200 and 1250 levels. The Vietnamese stockpiling rumours appear to have hit a 'sceptical impasse' as traders demand 'evidence' of the plan going ahead. The FOMC pledge should give LDN a semblance of support but not enough to break the current range. We remain neutral for the short-term, and look for a range breakout at 1250 and subsequent challenge of the 1280/1300 resistance zone before abandoning our longer-term bearish outlook.

Daily Coffee Market Outlook

NY- Sell (1)- A stronger USD and less than encouraging murmurs from China regarding interest rate increases sent the 'C' lower yesterday. However, Despite a brief probe below 130, the bears were not able to keep May below the lower support zone and the contract settled around 131. Today the onus remains on the downside. However, with the FOMC interest rate announcement due this evening, expect volumes to be low as traders pause in anticipation of what Bernanke has to say in terms of future direction. 130 should remain in support while 135 followed by 137 should cap the upside.

Liffe- Sell (1)- Early trading yesterday witnessed further losses as May made a charge for the 1200 bear target. Momentum was stopped short however as LDN recovered from the lows to close only a couple of dollars down. Momentum is still to the downside despite the bear 'failure' and we look for further losses today. The FOMC rate announcement this evening should ensure light volume and keep any movements muted.

Daily Coffee Market Outlook

NY- Sell (1)- NY failed to hold the 'high ground' on Friday as May closed below the 133.50 stability level despite posting fresh highs early on in the session. Concensus emerged over the weekend that Chinese premier Win Jiabao may take steps to cool economic expansion by raising rates following higher than expected inflation figures. Similar thoughts emerged from India, sending emerging market indices lower overnight. This is bad news for global markets as whole, especially commodities that have risen sharply over the last year fuelled by Chinese expansion. As such, the 'C' should retreat somewhat although the lower end of the consolidation at 130 is unlikely to be breached. 135 will provide a cap to the upside for now.

Liffe- Sell (1)- Upside developments arising as a result of the Vietnamese stockpiling plan appear to have been put on the back-burner for now as LDN resumed its downtrend at the end of last week. Failure to breach 1280/1300 has sent May Southwards as any hopeful longs liquidate and bears re-instate their positions. Developments emerging from China and the East should put the brakes on any upside potential today and as such we return to our bearish stance barring any more Vietnam rumours. Traders are likely to have their sights firmly on 1200 over the next two sessions and it remains to be seen how much demand will arise there.

Daily Coffee Market Outlook

NY- Buy (1)- An uninspiring session yesterday saw NY close 1 cent higher on low volume, driven primarily by the USD. Macro data from Europe this morning may give some direction as Industrial Production numbers jumped by the most in 20 years. This should help soothe some of the periphery fears and give some strength to the Euro. From a technical perspective, the door is open now for a challenge of the 137 zone in May, with the contract having closed above 133.50 last night. Coupled with a better macro outlook and weaker dollar this should all work in its favour. To the downside, 130 still remains the lower consolidation zone floor; it remains to be seen whether 133.50 can lend any worthwhile support.

Liffe- Neutral- Disappointing volume and market activity in LDN yesterday came as a result of Vietnam stockpiling uncertainty. Amid such a backdrop, it is difficult to gauge any real direction and technically speaking, the last few days trading have not been particularly significant for the chartists. As such, we choose to remain neutral for the time being, noting that any breach and close of resistance at 1280 and 1300 could signal an end to the downtrend and potential medium term reversal. To the downside then, the bears will still be targetting the 1200 support.

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.

Daily Coffee Market Outlook

NY- Neutral- As expected, the Greenback dominated proceedings yesterday, initially causing a sell-off before weakness in the USD going into the afternoon triggered spec buying and short covering above 133.50. However, from a technical perspective, May failed to close above that key resistance at 133.50 despite breaking through, and this will leave new longs unsure of their strength. We see the potential for more consolidation between 130 and 133.50 today (rather boringly) but keep our eyes northward in case of a further push toward 137/138. USD weakness following ex EU commissioner Prodi's comment that Greeces' financial crisis is over and the rest of the region is safe' may have an impact early on but more likely will be discounted as 'noise'.

Liffe- Sell (1)- Initial weakness yesterday turned into strength as rumours began to circulate that the Vietnam coffee association might be serious about its coffee stockpiling plan. Shorts scrambled for cover as specs tried to capitalise on the upswing sending May up $23. Although stemming the recent slide, we don't see yesterdays uptick as having any sizeable ramifications or marking a turnaround in sentiment, and look for a resumption in selling. May will need to break 1300 in order to stem the recent trend and this will require further USD weakness. 1200 is our downside target in the short to medium term.

Daily Coffee Market Outlook

NY- Neutral- Despite weakness in London, NY remained remarkably resilient yesterday and managed to post gains of just under a cent. May continues its' sideways pattern between 130 (which is proving to be strong support) and 133.50. There is little in the way of macro data due for release Tuesday, and so we retain a neutral stance. The USD, although having taken a bit of a back seat of late with the 'C', should dominate proceedings today.

Liffe- Sell (2)- The slide in LDN continues and specs, hedgers and funds continue to sell on the back of the downside momentum. May managed to settle below the technical target of 1226 yesterday, opening the doors to further losses; however, as we plough through uncharted territory with lower contract lows, where this slide will halt is becoming a guessing game and will likely turn due to wider macro developments. With no support of mention to the downside, resistance lies at 1280 and 1300; settlement above the latter required to put shorts in pain.

Daily Coffee Market Outlook

NY- Neutral- Friday presented a rather non-descript day once more despite positive non-farm payroll data supporting the USD. May managed to hold above support at 130, just about maintaining its sideways pattern. We see the prospect of holding above 130 likely once more as comments from Sarkozy gave the strongest hints yet that the EU will in fact support Greece if it struggles to fund its budget deficit, arguing the country was 'under attack from speculators'. This is a positive for the Euro and has seen the dollar fall against all major currencies overnight and investors plough into the 'risk trade'. Below support at 130, the next level is 124. To the upside, resistance lies at 133.5 and 137.

Liffe- Sell (3)- The mood for robusta's remains very firmly to the downside as origin and spec selling continue. Fundamentals also hint to the downside as Indonesian coffee production was reported to have risen sharply. Despite a weaker dollar, very little else lies in the way of further declines and as such we remain bearish. With May having clearly broken the 1250 support, the next technical target lies at 1226, and the likelihood of reaching it today is high. To the upside, resistance is way off in the distance at 1280 and 1300.

Daily Coffee Market Outlook

NY- Sell (2)- Yesterdays ECB and BOE rate announcements threw up little in the way of surprises yesterday with both central banks reiterating their current stance. Stocks rallied accross the board following a US report which said jobless claims dropped from a 3 month high, defusing concern that the US recovery is slowing. The USD rallied, inevitably affecting NY 'C' to the downside. The months highlight of US Non-farm data should shed more light on the state of the job market, what the global recovery hinges on. May held just above support at 130 at settlement last night; we expect another challenge today with a stronger USD. A close below 130 will open the door to 124. To the upside, 133.5 and 137 remain the resistance levels.

Liffe- Sell (2)- LDN struggled yesterday following Wednesdays close below the 1280 trigger and a stronger greenback. Amid light volume and lack of buyers, May slid below key support at 1250 before bottom pickers lifted it slightly to settle at 1249. Technically speaking, this should lead to more programme selling, although profit taking by shorts may provide a floor. We see further losses in the short to medium term then, but look to the USD for further guidance. Resistance lies at 1280, 1300 and 1335, but there is little prospect of any of these levels being challenged today.

Daily Coffee Market Outlook

NY- Neutral- Yesterday heralded a stronger Euro as positive news regarding Greeces rescue plans filtered through the market. However, unimpressive volume in the 'C' left May to settle slightly below unchanged. The tight range between 130 and 133.50 continues, and we see much of the same occurring today. The ECB and Bank of England rate announcements are out today, and this should provide the focus for the USD and commodity markets as a whole. Above 133.5, the next resistance remains at 137. To the downside, a break of 130 would open the doors for a challenge to wards 124.

Liffe- Sell (1)- LDN continues to flirt with the 1280 zone, and yesterday was no different. The market closed up small on the back of low volume as deliveries for March continue. LDN, like NY, is very much in a sideways pattern at the moment, with traders showing very little interest to buy or sell in volume. However, in the medium term, the trend points downward and as such we look for further losses today (albeit small ones). 1300 and 1335/40 remain the upside targets; to the downside, look to 1250 as support. We do not envisage any particular fireworks today unless the BOE or ECB spring some kind of surprise.

Daily Coffee Market Outlook

NY- Neutral- Another non-descript day in NY as traders looked towards the USD, with the board closing just above unchanged. Today could provide more of the same, as Greece pledges $6.6 bil more in budget cuts to appease its EU neighbours in their support. This should weigh on the dollar and perk up the Euro, possibly lifting the 'C' slightly. In terms of data, figures to watch in the US are the ADP employment numbers and ISM non-manufacturing this afternoon. May levels; 130 and 124 to the downside, 135 and 137 remain as resistance.

Liffe- Sell (1)- LDN continued its journey to the downside yesterday with the board closing down around $15. Weakness appears to attract more traders despite the stability seen over the last few sessions. Position rolling has provided much of the flow as we enter delivery period. With May unable to hold above 1280 or attempt a close above 1300, this momentum should continue towards 1250. To the upside, 1300 and 1335 remain the bulls' goal.

Daily Coffee Market Outlook

NY- Neutral- Lack of volume was the defining characteristic yesterday and the board closed relatively unchanged despite a big rally of the greenback against nearly all the majors. May remained within the current range of 130 to 133; and with a lack of macro data today, we expect this trend to continue in the short term. Levels to watch today then are 130 and 124 to the downside; to the upside, look for resistance at 133 and 137.

Liffe- Neutral- Despite USD strength yesterday, May manged to close $10 up for the day and hold above the 1280 level. This should add support to what is effectively a 2 month downtrend. Further closes above 1300 are needed to stabilise the market further but significantly, 1335 will need to be broken to turn sentiment north. To the downside then, look for support at 1280 followed by 1250.

Daily Coffee Market Outlook

NY- Neutral- Once more, it can be noted that coffee is being driven primarily by the USD rather than physical market fundamentals. Fridays rally was helped by the weaker dollar as the Euro attempted to claw back ground. As we look to May, the market has managed to climb above the stability zone at 130, thus halting the decline for now. Below here could see a fall to 124. To the upside, demand should be capped at 133 then 137.

Liffe- Neutral- Shorts were squeezed on Friday aided by month end rolling lifting Mar/May somewhat. As we look to May, The contract has clambered above the 1280 stability zone, and aided by a weaker dollar, momentum might continue to give the market a lift. The next hurdle to overcome is 1300, a break and close here giving longs a breather and maybe a further short squeeze. A break of 1335 remains the target to set sights northward. To the downside, support lies at 1250.