Juicy Trade Emerges As Volatility Gets Squeezed

Orange Juice has been on my radar for a very long time given how tight of a price range its been in...and stuck below former support at that. When looking at a volatility measure like Bollinger Band Width or Average True Range or anything else really, the picture is clear.

Prices have been consistently tight for the last 8 months and now look ready to expand in one direction or another.

We're betting that this expansion occurs to the downside for the primary reason that Orange Juice did not participate at all in the Commodities rally that began in August. In other words, it's shown relative weakness in the face of an improving backdrop for its primary asset class.

Click on chart to enlarge view.

As a result, we want to be looking at this market on the short side. A weekly close below support at 93 would confirm our suspicion and suggest further downside towards 66 over the coming months and quarters.

That's our trigger. If we're not below 93 we cannot be short, but below that the reward/risk is very much skewed in our factor.

Bonus Chart: 

I know how few of you reading this are actually interested in Orange Juice, so I figured I'd better throw in a bonus chart to make it worth your while. That chart is the Euro/Norwegian Krone pair as it successfully retests its breakout area and pushes back towards all-time highs.

As long as prices are above 9.90 in this pair, the reward/risk is very much skewed in favor of the bulls and targets 11.65 over the coming quarters.

These charts may not be as sexy as Tesla, but I can assure you they are worth watching if you're looking to make money in the market.

Thanks for reading and please let us know if you have any questions.

If you enjoyed this post and want access to our premium research, start your 30-day risk-free trial or sign up for our "Free Chart of the Week" to receive more free research like this.

Allstarcharts Team