Coffee and Golf Clubs

I've been following coffee for a while, accurately predicting the moves, and once again not making any money because I haven't been trading. Regardless, I think coffee is still offering up compelling risk rewards:

Here is the chart for coffee futures off of the all time high. It is a series of what I call "golf club" patterns because they look like a golf club. The pattern is characterized by a rounding off at the bottom after a steep drop and then a few failed rallies that market out a resistance line. The club usually ends in a rally. That rally usually ends in a steep drop.

Here we can see club #1 comes out of the initial drop from the high. This was a hard one to play because the rally was not as steep as one might have expected. Nevertheless a purchase at the rounded bottom offered a compelling risk/reward.

Next coffee carved out another larger club. Point #2 would have been difficult to call but again the rounding off would have been a signal to give the trade a shot.

Next coffee made another club, #3. This is a club within a club. It offered a nice trade when it rounded off but it offered a stellar trade when it dropped a little bit further and found support at the .618 retracement for the previous intermediate rally.

Now that rally looks to be coming to an end. Notice how the curve is tapering off right at the resistance lines. The primary resistance line I believe is the red line that marks the top of the gap (that drop off was in the A.M. session). Currently the rally is stopped at the .618 for the retracement itself. Given market conditions I'm expecting this curve to taper off for the next couple of days and then drop off steeply. It's a good trade now. Possibly an even better trade in two days although one can never count on the market waiting for you!

The gap at the bottom of the previous rally again ought to have been a tipoff to buy. Regardless, it now marks a target. Given the length of the rally though I wouldn't be surprised if it finds some support on the way back at #3 golf club's red line.

Coffee can be traded through the ETF JO although it is sometimes difficult to short. Also compelling (not shown):

Stochastics on JO have topped.
Composite has topped.
RSI is a day or two from resistance.
DeMark sell signal perfected and still counting.

The other soft commodities (Cocoa, Sugar, Cotton) are in a similar state and offering compelling risk/reward on the short side, although a few more days might provide an even better opportunity.