This chart, of the May Coffee, is a good illustration of the significance of the median (center) line. The line acts as dynamic resistance as the market trends higher. Coffee tested the median line three times during the cycle and failed after the fourth test on April 5. The swing pattern failure signaled an end to the upward trend and triggered a 700 points drop during the following four days. The market appears to have completed a bearish continuation pattern that could mark the center on the longer-term downward trend. I look for the market to stage a short-term corrective rally to test the down-sloping parallel line and set up a new selling opportunity. I will post any new sell recommendations in the TMV Swing Trade report.
