SINGAPORE: New York March coffee is expected to test a support zone of $0.9855-$0.9890 per lb, a break blow which could cause a loss to $0.97.
The zone is formed by the Sept. 18 low and the 186.4 percent projection level of a downward wave (c) from $1.25. Despite the strong bearish momentum, these supports may hold the fall for a while or trigger a bounce. Most likely, coffee will briefly touch $0.9855 and then rebound towards $1.0030.
It is still too early to tell whether the second bottom of a double-bottom is forming around $0.9855. A break above $1.0030 could lead to a gain to $1.0235.
Note: Coffee report is published twice a week - Tuesday and Thursday.
* Wang Tao is a Reuters market analyst for commodities and energy technicals. The views expressed are his own.
No information in this analysis should be considered as being business, financial or legal advice. Each reader should consult his or her own professional or other advisers for business, financial or legal advice regarding the products mentioned in the analyses.
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