July coffee futures at the New York Board of Trade this week hit a fresh three-month high of 118.40 cents. Prices have since moved into a “pause” mode, and this is not a bearish signal. Remember that markets tend to fluctuate between periods of higher volatility and periods of lower volatility. Coffee bulls have gained fresh upside near-term technical momentum recently, and are working on a five-week-old uptrend from the early-May low. A push and close above solid chart resistance at this week’s high of 118.40 cents in July coffee would provide the bulls with better upside technical momentum to suggest still more upside in the near term.
click on the chart to enlarge
A close below solid technical support at 112.00 cents in July coffee would deflate the bulls and suggest more of a choppy and sideways trading range in the near term.
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