Coffee Traders' Forum - A Discussion about Coffee Futures Trading
Coffee Traders Discussion Forum
With US/Chinese trade developments moving to center stage, the grain markets were under pressure today.
The US negotiators are on their way back from the mainland and some type of announcement should be expected over the weekend.
While the two sides will no doubt keep talking, the impasse is huge. As a result, weekend comments are unlikely to be trade friendly. Respect for Chinese leaders has nothing to do with unfair trade practices and outright theft of intellectual property. Like illegal immigration, the Chinese have stolen intellectual property for so long, they view it as their right rather than a sovereign infraction. The Chinese are also upping the ante on military tensions.
In short, once the commentary period is over later this month, the proposed tariffs could be implemented. This issues are, however, likely to be resolved over time because sabre rattling aside, the Chinese can’t win this. They need a place to sell inferior products and the U.S. is the world's largest market.
The outlook for rain in Central Brazil seems to have improved. The U.S. planters are also rolling on. Both no doubt contributed to today’s price weakness.
Regarding NY KC, would avoid influence from the Brazilian REAL. KC is consolidating without really giving up ground. That is not bearish. The dynamics that sparked the rally are also still in place. To this lonesome voice, the 18 month bottom is in. Makes sense to stick with the trend rather than attempting to micro manage the price action. Buying breaks could be quite rewarding in the months ahead. Best to avoid over analyzed noise and focus on the charts, tools and rules. Keep it simple