COFFEE SHORTCould not hold support; broke below $94. Next target area is between $90 and $86. Use a tight stop above $95.
KC1! trade ideas
Have a coffeeThe Coffee and the dollar
The price is above a key support zone, between approximately 96.4 and around 95, it fails to recover because exports are in sharp decline as the currencies of the exporting countries are affected by this devaluation against majors like the US dollar, tending to limit sales so as not to lose too much. All of this, has caused exports fall from the country that produces the most (Vietnam) by almost 40% compared to January (customs data published in the session on Friday). So this is a commodity that is particularly affected by the weight of the US dollar: the USD should continue to strengthen during 2019 (especially the second half), it is likely that coffee will continue to remain weak (except for sudden changes in the supply/demand ratio ). Now technically, however, it could be a good entry into this area (97) with a short-term target towards 104. A closure below 95, will ensure that the descent continues until new period lows.
Coffee reaches accumulation levelsCoffee is trading near multi year horizontal support of 95 cents. While excessive supply and falling Brazilian real crushed the prices, there is ray of hope ahead. With price almost reaching 95 level which seems safe accumulation level, there can be gains in coming months. Farmers in Brazil are reducing coffee cultivation area will lead reduction in inventories in coming months. Price hovering near critical long term support risk to reward is very low for investing in coffee for some months.
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Get me a coffee: strong and blackI'm eyeing up a long entry on coffee. I'll look at trading this through the 3CFL ETF. If the trade goes as envisaged and hits my wave 3 target, it could yield 100% profit thanks to the leveraged ETF.
Disclaimer: This is not financial advice. Do not follow my trades. Do your own analysis, make your own trading plans. I am not an Elliot Wave analyst and only use the tool to map out a general idea of how price may move. Constructive comments are welcomed and encouraged.
So why am I taking this trade?
The recent move up from the late September low looks pretty impulsive and price is currently printing what looks to me like a bull flag;
As price has been falling throughout this year, volume has started to swell, giving clear bullish divergence
More recently, in the July to September period of this year, the swelling volume could be considered stopping volume
Price has bounced off the $96 dollar level (12 year low) a level which has previously been a springboard.
Monthly / Daily RSI and stochastic RSI look bullish
Why am I targeting $148 by end of year?
Historical resistance level
Confluence with specific, modest fib extension level
Use of fib time tool to project key dates for pivots
Any reasons to be cautious?
Weekly RSI and stochastic RSI look bearish
Price could possibly make a W bottom and even make a lower low, with strong bullish divergence on stoch RSI / RSI - which would provide another good entry for a long.
Stop loss?
Subject to the opening price on the ETF tomorrow, I'll consider placing a tight stop around the $110 mark.
Coffee time?I've been stalking coffee in the background from many weeks. It's looking pretty ripe about now for taking a controlled loss (aka stop-loss). When coffee moves, it really moves. This is a longer time frame trade, which I do not usually get involved in - but it's probably time for me to get involved in one or two of these.
Coffee Short Setup Confirmed by Super Pivot StackThis is an excellent example of a solid risk reward level trade that is typically presented in a Super Pivot Stack setup. You could place your sell order below the Stack and the stop loss above the stack which is usually a very favorable size range compared to the profit potential in the trade setup.
You can see all 4 elements that make up the Super Pivot Stack, the Monthly Pivot Range is grouped with the Weekly Pivot Range, Daily Pivot Range and the 6 Day Rolling Pivot Range.
This provides a high probability scenario, with the Super Pivot Stack dominating the upside with super resistance. All these pivots working together make it highly improbable that the market will go higher, and rather sell off.
You will also notice the magnitude of the move. This is fairly common of a Super Pivot Stack, a large move that has a lot of momentum.
On the other hand of the market does rally through these pivots and stays above for a long enough period of time, then this could be a turnaround sign. If the price has that much strength behind it, you don't want to ignore this important fact. But, time is more important than price. So watch and be sure the upside move is not a fake out move that traps you into a long position against a Super Pivot Stack...not a good odds fight you wanna be in.
Happy Trading!
Short position in coffee futures. Horizon: 4 monthsThis is another average position form our long-term investments, very risky, which is included in our bearish commodity group over the next 5-6 months, correlated with bullish equity markets, a bullish dollar, a bearish euro, and a bearish token market.
