On 5 Year chart, we have resistance in #KC around the 135-140 level (Jul 2017, Sep 2017, Dec 2019, Aug 2020 and Feb 2021). This psychological barrier is tough to surmount. When there is no crisis, 140 is considered expensive in our collective psyche.
Yet since at least May of 2020 we have been recording higher lows. This means that for those #trading #coffee we are consolidating on agreement for the fair price of coffee at consistently higher levels but still below the expensive level (140).
Generally these occur mid-trend and suggest that price will continue to move in the same direction. However, in this case I think that we can read the price action more directly:
There are sellers at 140 who will fade the rally, but buyers are increasingly agreeing that the lows should be bought earlier and higher.
Usually this #
pattern ends with sellers overwhelmed, but can also end with buyers running out of steam. My view is that sellers will be overwhelmed later this year, but who knows? #Brazil often surprises with more coffee rather than less.