Hey riskaddict, can you reccomend a book that would teach a new trader how to go about trading commodites? ie; how much money you need to trade contracts and the various mechanics of the commodity market? I have been following commodities for a while now, but I haven't explored the mechanical side of trading them other than ETF's. I was looking at Lumber and it looks like a good time to go short, but I am a retail trader and don't know my options.
Adding on to my longs for today's opening, charts look poised to continue its momentum on friday. Any other views?
The less risky option would have been to add positions between 235 - 240 in consolidation and hold stops at 234 but no worries I hear 300 jingle bells ringing just before the all time highs of 1997
Attempting a counter trend trade today just got short at 290.00 I'm sure 300 is in the cards but probably not today
LONDON, Mar 09, 2011 (Dow Jones Commodities News via Comtex) -- World coffee production in 2010-11 is expected to total 133.7 million 60-kilogram bags, the International Coffee Organization said Wednesday, up 8.6% on year but still lower than its previous forecasts. The intergovernmental group lowered its February estimate by 900,000 bags due to a predicted 3.2% fall in output from the Asian and Oceana region after heavy rainfall cut output by 16.5% on year in major robusta producer Indonesia. World exports of the lower-quality beans have suffered as a result, the ICO said. While total coffee exports from October 2010 to January 2011 rose 13.4% on year to 33.7 million bags, robusta shipments fell 5.9%. Arabica exports rose 24.7% over the first four months of the marketing season, boosted by 12.8 million bags of exports from top producer Brazil, compared to 10.5 million bags for the same period in 2009-10, and a 900,000 bag rise in exports from Colombia. Still, the ICO noted that "world stocks have been significantly eroded due to supply problems and increased exports." Opening stocks for 2010-11 were estimated down a third compared with the previous season at 13 million bags. "With prices expected to continue at such remunerative levels, a high level of export performance can also be expected in coffee year 2010-11," the ICO said. "However, the prospect for replenishment of stocks in producing countries remains weak." -By Caroline Henshaw, Dow Jones Newswires; 4420-7842-9478; caroline.henshaw@dowjones.com ========= KAMPALA, Uganda, Mar 09, 2011 (Dow Jones Commodities News via Comtex) -- Uganda's March coffee exports are expected to drop by at least 17% on year as the main harvest winds down in Eastern and Central Uganda, the state-run Uganda Coffee Development Authority said Wednesday. UCDA projects March exports to drop to 180,000 60-kilogram bags from 201,809 bags exported in the same month last season. "The stocks in the hands of producers are also low due to lower yields from the just concluded harvest," a UCDA trade official told Dow Jones Newswires. Eastern and Central Uganda account for at least 55% of the country's total coffee output. UCDA attributes lower yields from the harvest in the Eastern and Central coffee regions to drought and pests and diseases which affected mainly robusta trees in the two regions. Ugandan coffee farmers are preparing for the second harvest in the Western and Southern coffee regions later next month. The two regions produce mainly robusta. Uganda is Africa's largest robusta producer and robustas account for at least 85% of the country's total coffee output. UCDA data indicate the country's coffee exports in the first five months of the 2010-11 (October-September) coffee year dropped 8% on the year to 1.1 million bags. Despite the drop Uganda maintains its earlier projection for 2010-11 coffee exports at 3.1 million bags compared with 2.7 million bags exported last season. Uganda exports nearly all its coffee output in bean form, mainly to European Union markets, and the country consumes only around 2% of its annual coffee output. -By Nicholas Bariyo, contributing to Dow Jones Newswires; 256-75-2624615 bariyonic@yahoo.co.uk (END) Dow Jones Newswires 03-09-11 0508ET Same BS you deal with in oil, who cares what expectations are
Maybe not but its still a big win - but it's time now to chase those profits on daily lows until it hits 300 - that number sounds just good to get out
Just checked in to see how things were going and ouch!! If we get back up to 295 I might add to this short.
Not sure I'd be short C right here. Maybe if you're trading it for a small correction, but I'm guessing coffee will hit 400 +/- before it really corrects back down towards 200. Cotton on the other hand looks ripe for a serious correction some time soon. zero leverage *Edit: a short arabica, long robusta spread may be appropriate at this juncture.
400 doesn't seem impossible with this perfect storm of bullish data and crazy demand just absorbing these prices. I'm just looking for something in the mid 80's by the end of the weak. I know next to nothing about the fundamentals of the coffee trade but it seems like every month it is the one thing I always make money trading, but I guess all good things come to an end.
Indonesia, Kenya, Uganda are just a few of the countries experiencing supply issues. Brazil's consumers now consuming 50% more coffee than just a couple of years ago. ICE warehouse stocks are down to 1.58 million bags and still dwindling. 3 million would be ideal. U.S. importers are now paying $10/lb for a bag of Kenya AA. This time last year it was more in the range of $4.00 +/-. Arabica from Indonesia is 88% higher than it was in October 2010. You may notice your coffee going down in quality as roasters begin to add more robusta beans into their blends. Robusta is in the $1.50 range from the importer.