Fundamentals seem to be aligning up just perfectly (BRL strength coming up, current cyclical low yield year, solid to steadily growing global demand etc.),
all the while the until-recently uber bearish chart already started to brighten significantly - to me at least!
Reasons enough for a cautiously bullish view of things.. and for me to open a small position...
This is an excerpt from the Parallax Weekly premium report originally published July 15, 2019.
"The net-positioning in coffee has surged, and the percentile metric is not suggesting it’s extremely overdone even though the one-year z-score is well above 2.
The problem now is that coffee prices have declined from $116 to $106 with net-longs still in charge. There...
An absence of frost risk & speedy Brazilian harvest helped major correction in recent days. Positive news for bull is that ICE monitored inventories are continuously dropping. Brazilian real also seems strong on charts, further good for Coffee bulls. Presence of 100 as psychological level along with 99 as fib support, Its worth buying 99-100 region for quick bounce.
Coffee has enjoyed a nice 5 wave bull impulse mirroring the start of its sister wave (A). After the 98.40 gap fill (likely just prior to the July 31 FOMC), purchase December 2019 OTM Call Options (expiring November 8 2019).
-The strong increase in coffee prices is due to the strengthening of BRL and the fear of frost
-The Brazilian hurricane delayed harvest, which could lead to a deterioration in crop quality
-Coffee consumption has risen to historic highs, but it is not yet visible at coffee bars
-Farmers receive only 10% of the final consumer price, so they don't get too much...
Unusually large volume was traded on 11 APRIL 2019 , this might be a trend changing volume bar. As of now, price has been retracing back into 93.20 (candle) range. A break above 96.75 would be the indication of the up trend movement for coffee prices.