Currencies and Risk of Default Pressure Cocoa Prices

December 7, 2017 2:34PM CST

Six straight down days in the March cocoa contract have traders questioning where we will find support. Thursday’s session may have found a bottom around 1880, but will cocoa reverse going into the weekend. Ivory Coast’s production situation could help a recovery after this short-term downturn. Long liquidating took over the market this week, keeping the bulls on the sidelines temporarily. A weaker Euro and Pound have traders concerned about global demand again.

The concern of financial issues involving exporters haven’t helped the cocoa market either. Will Hershey build a plant in Ivory Coast? – What will this mean for grindings and prices? These questions will create volatility and large swings in the market for the remainder of the calendar year.

Cocoa Mar '18 Daily Chart

Cocoa Mar '18 Daily Chart

RJO Futures | 222 South Riverside Plaza, Suite 1200 | Chicago, Illinois 60606 | United States
800.441.1616 | 312.373.5478

This material has been prepared by a sales or trading employee or agent of RJO Futures and is, or is in the nature of, a solicitation. This material is not a research report prepared by RJO Futures Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.