Some continued wet weather is key growing areas of Brazil has helped to keep March coffee futures prices in check, as earlier dry weather had been forecasted to be a large bullish factor. However, lock downs on restaurants and coffee houses will continue to prompt sluggish demand on coffee, but the promise of a future-tight crop should continue to provide March coffee prices with some support.
The UK has announced that they will begin distributing the Pfizer vaccine, which should be viewed as a bullish factor on the demand side for coffee. Although several factors will continue to play a role in how effective the vaccine and distribution of the vaccine will be, on-the-whole, the news is positive for the future of coffee shops and restaurants.
From a technical perspective, the aggressive bullish crossover of the price action through the 200-day MA has been followed by consolidation and strong support. The March coffee price action has also managed to back and fill the gap from 11/27/20 at 119, and has subsequently held support above the 200-day MA. There are several strategies that traders can apply in this situation.
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