If at first, you don’t succeed…
The recently stopped out JO (coffee ETN) still looks poised for a very significant rally & trend reversal and based on the developments over the past two days, I’m going to add JO back as a new official Long Swing Trade as well as a Long-Term Trade idea at current levels.
JO daily April 3rd
The price targets for this trade are T1 at 36.37, T2 at 39.04 & T3 at 41.30. The maximum suggested stop if targeting T3, which is my preferred long-term/trend target about 20% above current levels, is a daily close below 32.50. The suggested beta-adjusted position size for this trade is 1.0. Swing traders only targeting T1 or T2 might consider a higher stop using an R/R of 3:1 or better to your preferred price target(s).
KC daily April 4th
JO tracks /KC (coffee futures) and does a decent, although not perfect job of doing so. As such, I may slightly revise the price targets if/when prices begin to approach those levels. The reason for adding this trade back so soon after the stop was hit on the previous trade last week (at which point I stated that the charts still looked constructive) is the breakout above the downtrend line in /KC today following the recent divergent low (chart above) with the daily & weekly charts of $COFFEE below (stockcharts.com ticker for /KC, also note stockcharts.com only shows end-of-day price on futures charts so today’s breakout is not yet reflected on the charts below):
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- $COFFEE daily April 3rd close
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- $COFFEE weekly April 4th
