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Started by hayman - May 10, 2018, 11:15 a.m.

Coffee price has created lengthy declining wedge pattern that appears to have been broken out higher and now fallen back to classically "retest" the breakpoint.  Today marks the first upwards recoil for this vicinity and suggests the eventual move higher as such a pattern implies. This is a daily continuous candlestick chart.  In addition, drawn from valid pivot points that include the contract low, is an Andrews Pitchfork that seems to contain the price nicely and therefore serve as a guide in further price discovery.  

Re: Coffee
By metmike - May 10, 2018, 11:33 a.m.
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Concur on your analysis hayman.........wonderful price chart showing it.

Coffee, historically has seasonal strength here, which used to be seen as risk premium for the upcoming frost risk season.....June-August

However, there hasn't been any MAJOR widespread damaging freezes in over 2 decades.......there were 2 really bad ones in 1994. 

The reason for lack of freezes/frosts, besides beneficial global warming/climate change is the frequent destructive freezes in the 60's/70's.......during global cooling forced  coffee growing/growers north(closer to the equator) in Brazil.

Re: Re: Coffee
By metmike - May 10, 2018, 11:42 a.m.
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 Coffee Frost and                       Drought History


DateSeverity (Damage)Coffee Frost or Drought
1902 (Late July/early August)DevastatingF*
1918 (June 24-26)SevereF*
1942 (Late June/early July)SevereF*
1953 (July 4-5)SevereF*
1955 (July 30-August 1)Severeslight F
1962 (July 25-26)MinorF*
1963 (August 5-6)ModerateF and D
1966 (August 6)Severeslight F
1967 (June 8)MinorF*
1969 (July 9-10)ModerateF*
1972 (July 8-9)ModerateF*
1975 (July 17-19)Very SevereF*
1978 (August 13-16)ModerateF*
1979 (June 1)ModerateF*
1981 (July 20-22)SevereF*
1984 (August 25)MinorF*
1985 (August-November)MinorD
1994 (June 25-26 and July 9-10)Severe/Very SevereF and D
1999 (August to November)Severe (40% crop lost)
2000 (July 17)Moderate (est)F*


* In most cases frost or drought was not                    indicated by the source.  Although only F is written in                    these cases it is likely a combination of the two forces                    that caused a devastating coffee crop.

By metmike - May 10, 2018, 11:44 a.m.
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Our awesome web designer is working on these maps/graphs messing up the text. 

By metmike - May 10, 2018, 11:56 a.m.
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Glad you brought out coffee today. Getting close to the time to watch the weather for potential freeze threats:

This is a temperature map for the atmosphere around a mile up on May 17.

Some cool but not cold air headed to far S.Brazil in a week. on this map...........that I won't post because it might mess up this great thread.

Where the heck is Brazil you might ask?

The center of the map with all the yellow/red is the South Pole. If you go all the way straight up then turn right..........that's South America.. The outside periphery of the circle is Brazil.

Coffee is grown in Mineas Gerais which is near the northeast edge of what this map shows of Brazil.

Re: Re: Coffee
By hayman - May 10, 2018, 12:02 p.m.
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By metmike - May 10, 2018, 12:27 p.m.
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Excellent article.

Thanks so much for putting it out here as another weather trading commodity that get my adrenaline going!!! 

All other market discussions are especially encouraged gold from beck last we can generate interest from even more folks. 

Price looks very cheap right now but I remember first trading coffee in the early 90's when it was getting close to 50c.

I wasn't watching Brazil's weather in June 1994(focused on the grains and we didn't have the detailed global weather maps back then) when the major freezes hit and caused the front month coffee price to triple ......above $2.60 on the spike,  in a flash.

I have only traded options 2 times and on that occassion, sold some $3 coffee calls and collected the entire premium on them. 

Re: Coffee
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By silverspiker - May 10, 2018, 12:49 p.m.
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... the breakout from the wedge and then it's fading back to the wedge is one of my favorite bullish trade 


... the "fishhook" formation...

... nice eye there hayman... yank the rod and reel hard ...

---  Fish On !!!