The contract is riding on a wave C, the third wave of a three-wave cycle from the October 2014 high of $2.2910. This wave has been interrupted twice by two bounces around a support at $1.2170, its 50 percent projection level.
The second bounce from the Dec. 12, 2017 low of $1.1830 was much weaker than the first one from the June 22, 2017 low of $1.1550. This relation suggests that bulls were fighting a losing battle around the support at $1.2170.
This barrier may have eventually been broken, as coffee has been hovering below this level for several weeks. The moves from Nov. 6, 2013 low of $1.0415 seem to have been confined within a triangle, which could be a bearish continuation pattern, as it appeared after a downtrend.
Coffee could be heading towards a lower support at $1.08. Strategically, this target will be confirmed when coffee falls below the March 16 low of $1.1690.
A rise above the March 21 high of $1.2285 may be extended to $1.28, the upper trendline resistance of the triangle.
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