RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Brazilian Robusta growing areas will likely see increased production going forward with fairly favorable weather, but that may simply counter-balance a decline in the Vietnamese crop. It would likely be that decline in the Vietnamese crop that helps to support prices of May coffee from diving back down to the 135 level. A strong US stock market should help on the demand side, but there is apparently a good supply to sustain demand for a while.  

On the daily chart of March coffee below, we can see the violation of the 14420 critical low, which shortly after, was followed up by some short covering. In today’s price action, we’ve been able to recover from the overnight lows, and may see a move back up to 145 before we see a continuation of the downtrend that has been in place for quite some time. The key area to monitor is the 135 level. If this area is able to hold support, we may see a bounce back to higher coffee prices. However, a violation of this area spells a major selloff, likely back to lows not seen since June of last year.


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.