Ag Analysis Report 8-6-18 This Year, El Nino May Help The Price Of Coffee

It has been said the first coffee shop opened its doors in 1457 in Constantinople, modern day Turkey when the shop turned this funny looking seed into coffee. It has also be said coffee originated in Ethiopia over thousands of years ago, but made it's way to France and Italy buy way of Turkey. Fast ward to the 21st century and Starbucks pollinating the world and made coffee a must have morning and evening beverage.

Coffee prices have been in a downtrend since November 2016, falling 36% from a peak, but coffee prices look to potentially jump due to the development of the El Nino weather system. Such an event means dry weather in the coffee-growing regions of Brazil which produces about 40% of the world’s coffee. Dry weather isn’t good for the crop and could mean lower harvests.

Lets go to the charts to see if going long makes sense.

Monthly Chart (Curve Timeframe) - the monthly demand is at $75 and monthly supply is at $190.

Weekly Chart (Trend Timeframe) – price is in a downtrend, touched the weekly demand zone at $104 and has been basing their the last several weeks.

Daily Chart (Entry) – since we are in the middle of the curve on a monthly chart, the chart suggest there is more downside risk to the monthly demand at $75. Price may continue to pop due to the weekly demand, but if the daily demand at $105 doesn't hold, the chart suggests that price will pull back before it continues to move down towards the monthly demand at $75.

This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.

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Published on

by rollandthomas

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