Overview
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KC Arabica Coffee
Strategic
KC has spent another week inside the same 300–350 band, so the strategic view sits where it did last week. The chopsolidation carries on. A wave iii down should have produced impulsive downside by now, and it hasn't, which keeps eroding the odds on the bearish base case. A lot rides on the short-term moves to dictate where we go long term at the moment. So retaining the same base case until that changes. More detail in tactical notes.
Tactical
Last week KC gave us a nascent impulsive upswing off the 24 July low. We were looking for a pullback to hold 306, and since then the market has delivered just that. This recent action makes tactics quite simple. If KC breaks above the recent 347 high, bullish scenario targeting new 2026 highs is in play. However, a break of 306 confirms us firmly in the bearish base case.
CT Cotton
Strategic
Cotton is doing what we asked of it. The weekly upward trend holds and price continues pushing against the 81.50–83 Fibonacci extension pivot box, sitting just under the ceiling. A close through 83 opens the path to a new 2026 high, with 100 a very reasonable target.
Tactical
CT futures have been suppressed by our pivot box for more than three weeks straight now. The move up off the mid-July lows is a little amorphous, however printing higher highs in keeping with our bullish base case. Breaking above 83 puts cotton in the heart of wave iii up, 92 the interim objective and 100 the ultimate target. A drop through 75.50 invalidates this view.
