The iPath Dow Jones-UBS Coffee Total Return Sub-Index ETN (NYSEArca: JO) fell 1.6% Monday on light volume, which is no big deal in the volatile world of coffee futures.

JO is still up 80% this year, making it the top-performing non-leveraged exchange traded product. So strong have coffee futures been that the iPath Pure Beta Coffee ETN (NYSEArca: CAFÉ) is considered a laggard relative to JO with a 74% year-to-date gain. [Brazil Weather a Boon for Coffee ETNs]

Coffee’s transition from hated asset class to star performer has been stunning, but the charts indicate, the commodity could be ready to take a break.

“Looking at the daily chart for July Coffee, we notice what appears to be a double-top formation which gained some credence after the sharp price decline seen on Tuesday,” according to OptionsExpress. “There also appears to be a bearish divergence forming in the 14-day RSI. In order to confirm this bearish technical pattern we would need to see prices close below the 20-day moving average (currently near the 187.20 price level), and more importantly, see prices close on a weekly basis below recent lows at 167.95. A weekly close above 211.50 would invalidate the technical formation.”

Looking JO, the ETN resides comfortably above its important moving averages. The ETN is 6% above its 20-day line and almost 10% above 50-day moving average. JO is also a whopping 48% above its 200-day line, which could imply coffee futures are overbought at current levels. Coffee’s fundamental outlook, however, remains solid.

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