A reduction in orange crop is expected in Florida

Dmitry Lukashov IFC Markets

The US Department of Agriculture (USDA) forecasts a reduction in orange crop in Florida by 35% in the 2017/18 season compared to the previous season to 45 million boxes (40.8 kg). Will orange juice prices rise?

Orange crop in Florida is expected to be the lowest in the last 75 years – since 1942. The negative effects of hurricanes and citrus greening disease were the main reasons for this. Note that before the hurricane Irma began, the crop forecast in Florida was 75 million boxes. Expectations of higher orange crop in Brazil may prevent the growth of orange juice prices. According to the forecast of Fundecitrus, in the 2017/18 season, it may amount to 398.3 million boxes, which is 62% more than in the 2016/17 season and a quarter more than the average orange crop in the country over the past 10 years. Currently, it is difficult to say which forecast will have a major impact on price dynamics. Theoretically, the demand for orange juice increases in summer.

On the daily timeframe, Orange: D1 bounced off from the support line of the uptrend. The further price increase is possible in case of a reduction in the world crop, with high demand in summer.

The Parabolic indicator gives a bullish signal.
The Bollinger bands have strongly narrowed, which indicates low volatility. The lower band is titled upward.
The RSI indicator is above 50. No divergence.
The MACD indicator gives a bullish signal.

The bullish momentum may develop in case Orange exceeds the three last fractal highs, the 200-day moving average line and the upper Bollinger band at 144. This level may serve as an entry point. The initial stop loss may be placed below the two last fractal lows, the lower Bollinger band and the Parabolic signal at 135. After opening the pending order, we shall move the stop to the next fractal low following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop loss moving it in the direction of the trade. If the price meets the stop level at 135 without reaching the order at 144 we recommend to close the position: the market sustains internal changes that were not taken into account.

Summary of technical analysis

Position	Buy
Buy stop	Above 144
Stop loss	Below 135

Want to get more free analytics? Open Demo Account now to get daily news and analytical materials.

Author

Dmitry Lukashov

IFC Markets

Dimtry Lukashov is the senior analyst of IFC Markets. He started his professional career in the financial market as a trader interested in stocks and obligations.

AUD/USD bulls regain control above 0.6950 amid USD retreat

AUD/USD regains traction and extends the previous day's bounce from the weekly low, aiming for 0.7000 in Asia on Friday. The overnight pullback in US bond yields keeps the US Dollar below an 18-month high, which in turn offers some support to the pair. Meanwhile, hawkish RBA expectations also keep the major underpinned.

USD/JPY holds gains near 158.00 after Japan's weak Household Spending data

USD/JPY clings to gains around 158.00 after data showed on Friday that Japan's Household Spending fell for the ninth straight month, undermining the Japanese Yen. Meanwhile, the US Dollar remains depressed as the overnight fall in US bond yields counters a hawkish Fed and geopolitical uncertainties, could cap any downside in the pair.

Gold remains range-bound below $4,200

Gold has given up some ground after an initial bullish attempt to reach weekly highs, returning to below the $4,200 mark per troy ounce on Friday. The US Dollar’s strong upside momentum, combined with rising US Treasury yields across the curve, seems to keep further gains in the yellow metal under scrutiny.

Has Bitcoin really escaped the macro forces it was built to fight?

Over 17 years ago, Satoshi Nakamoto designed Bitcoin (BTC) on the back of a global financial crisis as an alternative to the global monetary system outside the control of central banks, governments and traditional intermediaries. This raises a key question: has Bitcoin really become independent of the macroeconomic forces it was built to challenge?

The Euro is not the sick man of Europe. France's bond market is

EUR/USD remains under pressure, near the 17-month low of 1.1161 reached on Monday. The pair has lost more than 7% since its yearly peak, as concerns over France's public finances increasingly weigh on the single currency. But behind the weakness of the Euro (EUR), the problem does not necessarily lie with the European economy as a whole.