Softs

Cocoa Prices Headed for Higher Highs

Posted 04/25/2018 3:32PM CTPeter Mooses

No new news is good news? There is a repeating pattern in cocoa futures prices – pullback, buy more, move higher. It appears that traders do not think this rally is over. Every time prices stall, or try to consolidate, prices move to the next level of support. The technical trade is still bullish, a continued close above the 9-day moving average plus a strong trend-line to follow higher. If the July contract can hold above 2860, look for 2900 + to be reached by next week. It appears that 2915 is that next level.  The supply and demand side of the equation is still there, production levels continue to come in low, crops in West Africa are a continued concern. The New York ICE contract versus London Cocoa spread continues to widen. All these signs show that the top in cocoa futures has not been put in. One of the top performing markets in 2018 looks to be keeping its own pace and not done climbing yet.

Cocoa Jul ’18 Daily Chart

Cocoa Jul '18 Daily Chart

Peter Mooses

Follow Peter on Twitter @PMoosesRJO. Peter's interest in trading began during a college internship with Bunge North America on the floor of the Chicago Board of Trade, where he assisted commodities traders and performed market research and analysis. Upon earning a B.A. in economics from the University of Iowa, Peter served as an analyst, transaction manager and team lead in the Global Trust Divisions for LaSalle Bank and Bank of America, where he managed transaction activity in multi-million dollar client fixed income and asset-backed securities portfolios. After years in the banking industry, it became apparent that Peter's real passion lies in futures trading. He joined RJO Futures because he enjoys the analytical aspects of futures trading and appreciates the economic impact that commodities have across all markets. Peter believes in utilizing market analysis and trends to help clients achieve balance between risk and return, while always keeping their investment objectives top of mind.