Fundamentals still seem to be the major driver to keep pressure on coffee prices. We have seen a nice pullback and consolidation, but weakness is still underway. Traders still say that September coffee is oversold, and it looks to be trading sideways for the time being. The Hightower Group has reported “record harvest just finishing in Brazil” and also “the market faces a record Vietnamese harvest just ahead.” It will take serious supply demand changes from the norm to spark any significant recovery in coffee prices.

On the technical side, coffee seems to be holding support at 100, and reached sub 99 levels this past week. For now, we’ll continue to hold a bearish outlook but hold off on new positions until we see a violation of 9865 (with subsequent pullback after that). Consider using put options to manage risk effectively.

Coffee Dec ’18 Daily Chart