Heavy consolidation with wide swings seems to be the primary story in December coffee prices. Little, if any, additional news to swing what has been an overall weak demand for coffee, coupled with supply issues reported from the largest producers in the world, this consolidation with likely continue for a little while.

Since the large and massive selloff that began in mid-September, coffee prices have been able to garner some solid support (and now consolidate) at the 124 level. The wide consolidation range from 127 highs, to the 123 lows have allowed for option writers to collect some good premiums.

Until we hear some solid news to push prices out of this sideways action, we will likely see this continue. Keep an eye out for violations of the aforementioned range highs and lows, as they will likely act as very good support and resistance to gauge entry from either side.


Dec ’17 Coffee Daily Chart

Dec '17 Coffee 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.