Orange Juice Futures - Free Money Long $JOAs a speculator I look into the logic behind $JO supply and demand. At price levels it changes hand and the climate outlook.
Lastly the technical outlook and CFTC positioning.
United states imported %66 of it's JO demand from Brazil in 2017 and as citrus greening and grove renewal is continuing to cap Florida producers. Leaving the U.S heavily dependent on imports in particular Brazil going forward.
Brazilian Real (BRL) lost significant value to the run up to the Brazilian elections and dragged many soft commodity prices lower this year creating a cheap buying opportunity. Since the elections have passed , BRL has been steadily on the rise. Across all indicators and positioning it is clear that BRL upside momentum is set to prevail. Which will support JO prices as importing the product will be more expensive.
CFTC data positioning is signaling a clear selling exhaustion at the low $140s. As citrus acid demand is increasing globally, U.S JO demand greatly import reliant from Brazil and BRL on the rise. Commercials are inclined to hedge JO futures keeping the commodity bid.
Technical analysis shows $JO found a floor on the weekly chart. Printing a clear reversal hammer chart pattern which has increased likelihood swinging prices back up. The reversal originated from short covering. A dynamic where short contract holders close their positions and therefore pushing prices back up. We have reasons to believe that this short covering trend is set to continue.
Speculators
$CADJPY short- Trading the Opec Campaign into 22nd JuneLast week options volume pointed at increased downside protection. Which translated into a yen rally or cadjpy drop.
This theme is still in play on top of that. opec is relaxing supply cuts and thus driving oil lower over the coming month, which will drag CAD$ with it.
I line with that we had a weekly bearish engulfing bar pointing at 82-80 area.
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Dollar and Gold exchanging position ahead of Fed Chair TestimonyThe shiny metal #gold has limited resistance until $1236 as US #Dollar Currency #Index should maintain its weight above 96.33 for a channelized healthy market.Though we have some probable possibilities on the other hand which can be unfavorable for short sellers,but we can carry on bear trend with higher selling until $1236.
