FCOJ futures rally on anticipated tight Brazilian stocks
In a four-session rally that began last Friday, most active Nov-22 FCOJ jumped from resistance near 163.35 cents per pound solids to a settle Wednesday at 185.35 cents, breaking past the previous August high and the upper Bollinger Band. The contract gave back some of Wednesday’s gains on Thursday, settling at 181.15, back below the upper Bollinger Band.
The rally for futures comes on industry announcements from Brazil that confirmed production constraints and a tight market in 2022/23. Though orange juice production is seen as rebounding next season by as much as a quarter, carryout is likely to remain depressed.
For the November contract, support may lie from below 180.10, 177.00, 176.85, 171.70, and 174.25. Resistance may be around 183.55, 185.35, and 190.00. RSI is neutral to bearish. RSI showed a bullish crossover. The stochastic grew slightly less bearish on Thursday’s modest correction.
Nov-22 FCOJ futures & Relative Strength Index (RSI)
Source: DTN, McKeany-Flavell
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