- It still might not be safe to try and enter the wagering landscape of Coffee Arabica for many speculators.
- Last Tuesday’s fast move following the U.S holiday saw a quick test of the $400.00 mark and lower. However, Coffee Arabica then saw what has become a standard surge of buying which took the commodity towards the 430.00 realm and within sight of all-time highs achieved only the week before.
- But then Coffee Arabica started to sell off quickly. By the end of Wednesday after challenging the higher price levels,
- Coffee Arabica was again near the 415.00 realm. And then when trading began on Thursday more selling entered the commodity’s market with the 410.00 ratio quickly turning into 400.00. By the end of Thursday lows around the 392.00 price had been seen.
Friday’s Price Action and Going into This Weekend
Friday’s trading saw some buying create upwards fight in Coffee Arabica, but the 400.00 level did become durable resistance and the commodity began to sell off again. Going into the weekend near 393.85 may appear to be a battle that has been won by sellers. However, we have seen this show before, and anyone who wants to bet blindly on Coffee Arabica needs to be bold and quite possibly rich. The commodity may simply respond to the selling with more ferocious buying in the days to come.
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The last time the 392.00 and 393.00 price level was seen (and only in a limited manner) was on the 5th of February. Traders do not need to be reminded that Coffee Arabica has been in a bullish mode for a long time. However, not only did Coffee commodity prices drop last week, but the price of Cocoa fell too. There is a relationship that speculators in these soft commodities need to watch.
Wishing to Take Advantage of The Great Downturn in Coffee
Coffee Arabica remains within a sky high price range. The selloff in the commodity last week is noteworthy and perhaps some bearish traders were able to take advantage of the move lower. The desire to ride momentum downwards in Coffee Arabica may be great among speculators who believe the price of the commodity is overbought.
- Certainly it appears the value of Coffee Arabica is still too high. But selling Coffee Arabica has proven to be a difficult task since October of 2023.
- Moves lower in the commodity have been seen before, and then stronger reversals upwards have been generated.
- Traders who believe there is more downwards price action coming cannot be faulted, but they need to practice very strong risk management.
Coffee Weekly Outlook:
Speculative price range for Coffee is 372.00 to 418.00
Was last week a sign of weakness which is going to develop mid-term in Coffee Arabica? Are the largest players in Coffee Arabica going to start selling? Large speculative forces in Coffee Arabica may now look at the 390.00 level as a support level, but there is more a likelihood they are not interested at all in this ratio. If Coffee Arabica opens with buying this week it simply will mean that large players in the commodity remain in charge and believe higher prices are the new normal.
Day traders need to hope to step into Coffee Arabica and wager on the correct direction chosen by larger players regarding momentum. Traders who believe last week’s selling is a sign of things to come should not get overconfident and be willing to cash out profit if they develop. The price velocity upwards in Coffee Arabica was powerful in late January and early February, perhaps this was a sign that buyers may finally be running out of upwards fuel. However, betting on downside in Coffee Arabica has been difficult over the long-term and the commodity remains a playground for adventure seekers.
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