The chart for Coffee Holding has been uptrending modestly for the last two months and change, with shares moving higher from its low of $5.99 to its recent high of $8.19 a share. During that uptrend, shares of JVA have been mostly making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of JVA within range of triggering a near-term breakout trade.
Market players should now look for long-biased trades in JVA if it manages to break out above some near-term overhead resistance level $8.13 to $8.96 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action 157,452 shares. If that breakout hits soon, then JVA will set up to re-test or possibly take out its next major overhead resistance levels at $10 to $12 a share.
Traders can look to buy JVA off any weakness to anticipate that breakout and then simply use a stop that sits close to its 200-day moving average of $6.98 a share. One can also buy off strength once JVA takes out $8.13 a share with volume and then simply use a stop right around some near-term support at $7.50 a share. I would add to either position once JVA clears $8.96 a share with decent volume.
This stock is another favorite target of the short sellers, since its current short interest as a percentage of its float is 19.2%. Any breakout in the near future could easily set off a large short-squeeze in shares of JVA, so make sure to keep this name on your trading radar.