Coffee Testing A Trendline Going Back to 2002
Simit Patel | Sep 06, 2015 02:09AM ET
Below is a monthly chart of coffee. The chart reveals a tentative trendline established in March of 2002, and then successfully defended in November of 2013. The monthly chart is now touching the trendline; a successful defense of this trendline would give it three confirmed points, which would serve as validation from a textbook trendline analysis perspective.
Traders may find some great reward/risk opportunities buying here. A trader who enters at 114.30 with a stop at 97.85 — below the 2013 low — and a target profit near resistance at 206.45 could enjoy a reward/risk ratio of over five.
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