May coffee continues to struggle with weak demand due to the ongoing slow-but-sure reopening of the economy. Although the long-term outlook from the worlds largest producer is still quite bullish, the near term continues to dance along support levels that have been in place since December of last year. In addition, a continued weak Brazilian currency promises to hold May coffee prices in check until demand begins to pick up.

From a technical perspective, May coffee has violated both the 25 and 50-day moving averages. However, May coffee prices have been comfortable in this range from 1.22 to 1.30 since December of last year. Although RSI levels are not yet oversold, we may see a continuation in the intermediate selloff back to the 1.22 level if positive demand news is not found soon.

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Coffee May ’21 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.