Dollar Weakness May Brew Support for Coffee prices
The Strategy Session
From the Trading Desk at Stipelis
8-6-2025
Coffee prices have shown signs of resilience, closing at 298.70 and posting a sharp 3.52% gain on the day, despite falling back slightly intraday.
Year-to-date, the contract is still down over 6%, but current technical indicators and intermarket forces suggest a potential turnaround may be brewing.
The U.S. Dollar, which typically trends inversely to commodities, declined 0.51% intraday and shows a bearish closing structure.
This opens the door for commodity inflows—coffee included.
Volume and range are both elevated, suggesting strong activity and potential accumulation. Fundamentally, concerns over global supply, particularly from Brazil, continue to underpin support.
Technically, coffee remains in a “No Signal” zone, meaning it’s not yet a confirmed breakout.
However, if the dollar continues to weaken, and soft commodities gain traction, coffee may follow cocoa’s lead higher.
Momentum is positive, the monthly pivot is bullish, and the market is approaching near-term resistance with rising volume.
While short-term traders should watch for pullbacks to the 285–290 range as possible reentry zones, a medium-term target of 315–325 is realistic, assuming the macro backdrop remains supportive.
If the dollar stabilizes or rallies, coffee may struggle, so currency trends remain key to this forecast.
The opinions expressed are those of Stipelis Global Trading LLC and are considered market commentary. They are not intended to act as investment recommendations. Individuals should make investment decisions based on their own analysis and with direct consultation with a financial advisor.
Stipelis Global Trading LLC is registered with the Commodity Futures Trading Commission and is a member of the National Futures Association. Member ID 0474441
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