Over the past two trading sessions, March coffee futures have climbed back to the middle of a well-defined established since December. March coffee prices have rallied due to the promise of a “return-to-normal” dining out economy, with many US States easing their restrictions and producing additional demand in the process. Vaccines continue distribution at a slow pace, with President Biden promising that “by the end of July we’ll have 600 million doses, enough to vaccinate every American.” Clearly this promise has resulted in optimism for those that require a physical vaccination to return to work and those that simply want one. Optimism results in demand, which we are now seeing.
The recent rally from February 16th where March coffee futures went from 1.21 to 1.2490 has prompted additional follow-through buying, but the market seems to be easing on momentum for the time being, after such a strong move. The range of 1.20 to 1.25 has been quite comfortable for some time, and we will likely see strong resistance at the 1.27 level. A break above 1.32 will be needed for a leg higher.
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