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ICE Coffee Climbs in Minor Base Pattern -- Technic

ICE Coffee Climbs in Minor Base Pattern -- Technical Analysis

By Kira Brecht

ICE March coffee futures climbed in early trading Wednesday. The short-term
trend bias is neutral-bullish for March coffee as the contract carved out a
minor base pattern on the daily chart off the Dec. 12 low at $1.1830. The
primary trend remains bearish for March coffee, but a consolidative and
corrective tone has gripped the market in the short-term.

ICE March coffee recently traded up 105 points at $1.2325 a pound.

The March coffee contract has etched a higher low on the daily chart
starting with the Dec. 12 low at $1.1830 and then the Dec. 22 low at $1.1950.
That creates the beginning of a new minor uptrend pattern. On the upside, March
coffee sees nearby resistance and a bullish target at $1.2405, the Dec. 20
high.

Daily momentum points higher and supports short-term coffee bulls. The
14-day relative strength index hit 47% on Wednesday. The momentum indicator is
climbing out of a bullish momentum turn that formed in mid-December from an
oversold 28% reading.

On the downside, the $1.1950 low now becomes key support for March coffee
and as long as that level holds, the bulls will retain the short-term technical
edge.

If March coffee bulls support a dynamic rally through the $1.2405 ceiling
near-term it would open the door to a stronger counter-trend rally phase.
Initial upside targets are seen at $1.2480 and $1.2485, the Nov. 1 and Nov. 20
daily lows and then the 40-day moving average at $1.2613.

The primary trend remains bearish for March coffee. The weekly continuation
chart for ICE coffee reveals a downtrend off the November 2016 high at $1.7600.
For now, short-term strength can be considered corrective to the larger coffee
market downtrend.

(END) Dow Jones Newswires

December 27, 2017 09:23 ET (14:23 GMT)