Coffee Futures—Coffee futures in the July contract settled last Friday in New York at 138.50 while currently trading at 142.20 up about 370 points for the week as prices are near a 4 year high continuing it’s bullish momentum.
I have been recommending a bullish position from around the 126 level and if you took that trade continue to place the stop loss under the 2 week low which stands at 131.10 as an exit strategy on a closing basis only as the chart structure will continue to improve. Weather conditions in the country of Brazil which is the largest producer of coffee in the world continue to be a concern due to the fact that they are not getting adequate rain at this time and if this situation continues you could see sharply higher coffee prices.
At the present time coffee is trading above its 20 and 100 day moving average telling you the trend is to the upside as the entire soft commodity sector remains in a bullish trend as I have several bullish recommendations at the current time.
The volatility will start to expand to the upside as coffee is one of the most volatile commodities that can experience tremendous price swings on a daily basis as historically speaking prices are depressed so stay long.
CHART STRUCTURE: IMPROVING
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