RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Very impressive and positive price action in the September coffee has presented what could be some good trading opportunities. September coffee is now testing the highs from May and this area should pose some very strong resistance. In the near term, there have been some supply concerns, which have helped to lend some support. In addition, we’re seeing some good weather premium due to a drastic drop in temperature throughout major coffee-growing areas in northern Brazil. Since even the slightest weather abnormality can cause drastic volatility in commodity prices, traders have jumped on board this intermediate uptrend wave. However, keep in mind that for short sellers and others that are bearish, this should present a key opportunity to step in and short the futures, as prices are very close to resistance levels.

On the daily chart of September coffee below, we can see prices are aggressively testing the 13560 high from May 31. At this level, we can see that prices have also violated a significant downtrend that has been in place since January of this year. From a risk-reward perspective, a short position could be advised, which would risk slightly above the aforementioned resistance area. 


Sep ’17 Coffee Daily Chart

Sep '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.