Context is everything

September 14th, 2012

I was having a look at the C-price for coffee today, and looking at the recent fluctuations. As I looked at different time spans the data seem decreasingly dramatic. (There’s probably a metaphor for life or something like that in here too.)  I’ve included the graphs below so hopefully this makes sense:

Intraday Trading today:

Not particularly useful data.  A little spike, but only of about 1 cent.  Let’s look at movement across the last 3 months:

This now looks like a dramatic recent spike of over 20 cents per pound.  A big deal surely?  Let’s have a look at this in the context of the last year:

I’m not interpreting this data, just presenting it like this because I think it is interesting.  Suddenly this spike doesn’t look so spikey.  It seems like a brief blip in a trend downwards.  In the context of 2 years it looks like this:

I don’t know what this means but then I’m not sure anyone does.  This particular jump is likely the result of non-coffee related factors like speculators and the recent announcement of Mr Bernanke at the Federal Reserve.  I can only imagine how this looks to people who have more than 20 years of experience dealing with this market.  Perhaps it has some meaning to them.

If this is mildly interesting, and you want a place to keep up with the C then I like this website a lot.

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