This morning the new year began with selling below unchanged which set the high thus far. Selling continued and has tested the 100.50 area a couple of times. There are bids lined up on the way down and the sell side is clear up to unchanged. 8:00 will be a revealing time for the funds whether they are buyers or sellers. For sure, and as observed by JuanV as well, the funds are not as aggressive on the sell side as we have seen them in the past. The 100.00 level, give or take, has proven to be an area of interest for buyers. We’ll see if this hold true. For now the market seems to be reacting to the $ which is still higher against most currencies but is weakening. Robusta is equally quiet with the arb at 32.09 and quiet. Spreads in both markets are softer but also quiet. Hopefully market participants will begin the year in full blast. There may be peculiar behavior both in EFS and in TAS as Index rebalancing takes place. Otherr than this, we look to follow any Bolsonaro developments. EM markets are mixed. USDMXN is 19.7074 +.0644, USDCOP is unchanged at 3245.00 and the Real is firming as reflected in the USDBRL at 3.8781 -.0023 -.06%.
In the macro environment we can expect pandemonium this year as many countries are at odds as is the world order and as is in the USA. In spite of the $ strength, metals are higher as are bond futures. Oil and equities are lower. Cotton and sugar are higher while cocoa is lower.
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