Best Financial Markets Analysis Article The recent drop back in Coffee has been deeper than expected, and price has quickly arrived at a key support area that we identified. This is a likely place from which a positive reaction can occur, and in the process avoid/postpone further bearish implications.

The Commodity Trader’s view

WEEKLY CHART – CONTINUATION:

The recovery off 76.4% support, from late last year, recently reached the 61.8% retracement on the continuation chart.

Clear resistance has been seen, with obvious support from the prior 123.40 Jan high failing to halt the bears.

WEEKLY CHART – SEP-09:

The Weekly chart of the front month shows failure near the lower 50% level, and almost exactly at the old 144.75 May-08 low.

DAILY CHART – SEP-09:

In the Commodity Trading Guide we had initially thought that the 129.00 area could support, but we had noted the lower 121.00/120.00 area as key support too. Ideally the channel base projection will hold, otherwise medium term bull momentum is called into question.

Bulls would want any overshoot to be contained by the 117.45 76.4% pullback.

Speculative buyers in the 121.00s (or 120.00s) have a limited risk level in that 117.45, so stops perhaps just below 117.00. Partial profits would be sought in the 135.00-138.00 area (probably towards the lower end), stops then rising to cost.

A break below that 76.4% level would increase medium term bear risk once more.

We welcome interest in our free 30-day trials for our Guides

Philip Allwright

By Mark Sturdy
Seven Days Ahead
Be sure to sign up for and receive these articles automatically at Market Updates

Mark Sturdy, John Lewis & Philip Allwright, write exclusively for Seven Days Ahead a regulated financial advisor selling professional-level technical and macro analysis and high-performing trade recommendations with detailed risk control for banks, hedge funds, and expert private investors around the world. Check out our subscriptions.

© 2009 Copyright Seven Days Ahead - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.