Cup of roasted coffee beans on pile by Negative-Space via Pixabay
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Europe’s gas storage remained below average, leaving the United Kingdom’s system more exposed. Also a heatwave in the eastern U.S. boosted LNG competition globally, but UK gas demand stayed moderate thanks to local renewables.
There are three key catalysts to consider right now:
Norway has had unplanned outages and capacity cuts in its gas fields and European Union and United Kingdom storage has been at lower levels.
Demand is more moderate because temperatures are warm, but not extreme.
Middle East conflict has pushed prices upward.
Natural gas prices are technically in an uptrend quoting above the 10, 20 and 50 EMAs on a daily chart. It has closed the gap opened on April 2. The upward march started on June 12 seems to struggle to break the 100 mark. Long traders can use the 10 EMA as a dynamic stop loss. This move may be losing steam at this point. The 14-day RSI marks 62.99 and looks ready for a short-term pullback.
European production remains solid with limited carryout from the previous crop, supporting current prices.
Here are the key catalysts to watch:
While Black Sea exports remain stable, persistent dryness in the region could slow future exports.
The European Union is forecasting maize production around 63.8Mt for 2025/26, up 7% from last year and above the 5-year average.
Firm animal feed demand in Europe is helping buoy prices.
These points support a bearish view for European corn prices, but this has already been the case since last February.
European Corn has made an impressive rally in the last four sessions but is now hitting the 50 EMA which is a strong dynamic resistance level. This resistance has not been broken since Feb. 28 and it is the fifth time it is under test. In the short term, the bias favors the shorts. In the long term, look for a breakout above the 50 EMA.
Here are the key catalysts to watch:
Operating rates across European primary smelters held steady at about 87%, indicating consistent supply.
Conflict in the Middle East increased prices in European energy markets, which has supported aluminum prices. This is because electricity is a major input for aluminum smelting and represents about 40% of production costs.
Industrial appetite has remained muted amid a seasonal slowdown in Europe.
Story Continues
These short-term dynamics lean toward weak demand and ample supply. Without stronger downstream activity, upside is limited.
Current prices are above the 10, 20 and 50 EMAs, showing a bullish development in the last 9 sessions. Pay attention to the level 2,630 as it has been a tough resistance point in the last 3 years. For now, this metal has momentum.
Here are the key catalysts to watch:
Persistant rain in Côte d’Ivoire slowed mid-season pod development and harvest-lifting, generally leading to West African mid-crop delays.
The ICCO projects a 7.8% global production increase to 4.85 Mt in 2024/25, outpacing a roughly 4.8% decline in world grindings. This would lead to a modest surplus.
ICE-monitored stocks have recovered from 21-year lows.
These factors are bearish for the longer term. The global production surplus and rising stockpiles will weigh on price upside, especially as inventories rebuild.
However, demand remains firm. Despite inflation and consumer squeeze, cocoa processors in Europe have held steady and cushioned the market downturn.
The technicals show similarities with Robusta coffee (RMU25). Although still in a downtrend, we observe the RSI at 38 just bouncing from 32. Also, the last 2 candles are closing above the local lowest (5,265). Short traders are clearly taking profits in the last sessions.
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Despite the recovery, prices remain below the $4,400‑4,500/t highs seen earlier in June, reflecting a highly volatile range.
Here are the key catalysts to watch:
Brazil reported reaching almost 50% of its Robusta crop by mid-June, in line with the last five years.
A steady harvest in Brazil and stable production in Vietnam and Indonesia is feeding plentiful supply for European imports. No major disruptions were reported last week from Africa.
European warehouses appear to be well supplied with no fresh tightness.
Demand among roasters remains solid with no signs of sharp drop-offs.
We see now an interesting situation as the long-running downtrend seems to be stopping as per the last “engulfing bullish” candle pattern that gives hope to those starting bullish positions. The 14-day RSI indicator has quickly bounced from the 20 “oversold” level.
This last move again reinforces the view that we are close to a turning point.
On the date of publication, Cesar Marconetti did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
