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CSCE coffee nudges lower but still rangebound

NEW YORK: CSCE coffee futures eased on Wednesday amid technical selling but still moved within a narrow range ahead of first notice day for the March contract.

Spot March arabica KCH0 closed 0.85 lower at 104.95 cents, trading 107.00-104.90 cents a lb. Active May KCK0 ended the day at 107.55 cents, off 1.10 cent, whilst back months lost between 0.90 and 1.15 cents.

Arabicas eased in light trading interest with most activity focused on switching positions positions from front month March into May.

Open interest in spot March fell another 1,629 lots to 12,141 as of February 15, while it increased by 1,449 to 25,555 lots in active May delivery.

"We continue to test the most recent support," said a Miami-based broker. "The longer we sit at this level, it's just a matter of time before we break and go down to 100 (cents).

The latest CFTC Commitment of Traders report showed non-commercials, or large speculators, holding a net long position of 5,633 lots as of February 8.

Traders said support for May arabica stood at 107 cents, then 104 cents, while resistance will likely be found at 110 cents, then 112 cents.

"The fact that it's stabilising at this level means that producer sales are coming at lower and lower levels, capping any rallies and making the bulls quite tired," said the broker. "If we don't bounce off this level today or tomorrow, we're probably looking at more long liquidation going toward the end of the week."

Volume traded on Wednesday reached an estimated 15,766 lots, against the previous official volume of 14,917 lots. Call volume reached an estimated 1,298 lots, whilst puts were seen at 762 lots.-Reuters