In the preceding week, the Coffee Futures had a technical upsurge in which made it hit its 4 month high. However, the increase was short lived as the futures decline this week. In early trades of the week, the Arabica coffee declined by 3.7% in which had hit 132.17 cents for each pound. Last week though, the bullish performance was seen hitting 140 cents compared to this week’s loss.
Although the price line was still in a good condition, the withdrawal in demand value has caused major uncertainties within the investor psychology, making the technical support vanish in thin air. This has also resulted to a downfall in price rates. It is expected that the futures will go further down 129.71 with such performance.
The Arabica Coffee futures were well approved by investors before they mount back their bearish calls amidst harvest season’s arrival. Generally however, Arabica coffee’s prices have faced pressures under the fact that the market has still enough supplies of such futures.
The first few seasons had high yields in which have gave roasters a hefty amount of beans. Such event has pulled down buyers from the market and has halted the recent rally in its chart performance. This was believed as an expected correction.
Despite Arabica being this pressured, Robusta on the other hand has shown some strength. Robusta, which also faced pressures lately, has shown noticeable growth in its recent trades. Also, Robusta is a global hit right now despite the lingering drought on some crops for the current season.
However, despite such hype, the Robusta futures is expected to have its trend face a cool-off soon as its options are about to expire this week. Also positions are being readjusted to support price rates for the said futures.
The Arabica Coffee futures on the ICE Index have faced a lot of bears in its recent trades. It can be seen above that the futures faced pressures and was unable to upheld bulls while the bear domination was happening. The last candle finished at 134.50.
As for its relative strength index, the indicator was close to touching the area below the 40’s region. It is expected to go beyond the range soon while being specifically at 40.48 recently.
Lastly, the Coppock curve also mirrored the two indications above by indicating a downtrend in its performance. While still far from the negative region, the futures may soon hit it with the issues stated above so a hold on buy would be advised for now.
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