As several States begin to shut down after just re-opening due to the spread of COVID 19, we can expect yet another challenge on the demand side for September coffee. This new shutdown will be weighed against recent reports that temperatures in key growing areas of Brazil are colder than normal, thus possibly delaying and affecting the upcoming crop while frost damage becomes a real possibility.  September coffee futures recently broke out of consolidation due to the reported temperatures in Brazil, and coffee prices have been able to hold support at the 95 level.

From a technical perspective, a likely return to the 50-day moving average at the 104 level is likely to take place in the near term. However, ultimately may see stiff resistance at the 50-day moving average as the await the effects of the recent increase in new cases, which will likely delay a reversal to the upside for September coffee prices.  

Coffee sep ’20 Daily Chart

Adam Tuiaana

Adam grew up in Chicago and was always fascinated by the fast-paced action found in the futures market hub there. He began participating in the financial markets by trading stocks in 1997 and began his career as a trading consultant with RJO Futures in March of 2009. At RJO, he specializes in risk management and disciplined trading plans, and is focused on educating clients with one-on-one consulting and training. Adam believes the best approach to trading is to take a measured and objective approach and let the markets guide your decisions.