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Posted by Tango
on June 19, 2019, 7:05 am
RC opened with selling followed by KC that also opened on the weak side. Both markets set their respective lows and both recovered. KC is quiet and drifting at the moment. Good resting bids are present in Sep and scattered bids in the forwards. The July OI is likely below 10,000 after yesterday. The Sep OI is only 126,722 and considerably lower than July at its peak, indicating the extent of buying by shorts and closing out of spreads. In spite of FND season having a less significant role, the market remains on the defensive. Yesterday the strong Real did not invite any buying and weakness prevailed. Spreads continue to be steady in KC and weak in RC. The arb is slightly higher from yesterday at 34.55.
The prime currencies that comprise the DX basket are all higher against the $. EM markets are mixed with the Yuan slightly lower. USDMXN is 19.1411 +0.0225 (+0.12%), USDCOP is 3,253.00 -0.1 (-0.0031%) and USDBRL closed at 3.8595 and is valued at 3.8532 on the CME.
Bond futures are lower as we wait for the Fed to finish their meeting. Gold is lower and equities are unchanged. Crude, grains and sugar are lower while cotton and cocoa are higher.
The market is on the soft side and making new lows. 8:00 should bring buying but, as we see, selling is dominating the market. For now we remain in a narrow range.