Coffee Traders' Forum - A Discussion about Coffee Futures Trading
Coffee Traders Discussion Forum
Hi Dibbs. I am not a scholar on the indicator, but the very few times I have seen this in Coffee it simply means that the market has no problem with being more overbought. In this particular instance, we hear of all types of divergences lately and none have come to fruition. When price goes up and the indicator does not, it could mean that the underlying trend is very strong and yet to ensue in force. And I meant we have not seen this in coffee on the bullish side. There have been plenty of times when the MACD has indicated a converge for buy or even a buy and price has kept going down--plenty of times. Now we have an inverse situation. Everyone shorting these signals just keep getting bumped out, and as we have seen in the COT there is still short covering to be done by funds. Trade selling does not appear to be particularly strong here and my guess is neither roaster buying. I am afraid that this market is becoming a bit explosive because there are no breaks.