Softs

Are Cocoa Prices Building Up for a Breakout

Posted 04/30/2020 10:25AM CTEric Scoles

Jul ’20 Cocoa Futures start the day showing some strength despite weakness in equities this morning. Cocoa being economically sensitive has seen this product under price pressure with the constant threat lower demand holding buyers back. There has been some return of risk on sentiment building quietly in the markets which has been adding bullishness to this market. Rising or at least stable prices in Cocoa are supported by continued production concerns, which with any significant return in demand would give cocoa futures solid upside potential. From a technical perspective this market is well off the lows and has tested looks ready to test resistance again. If Jul ’20 cocoa futures can break out and close above 2400 it could be a solid bullish opportunity.

Cocoa Jul ’20 Daily Chart

Eric Scoles

Eric entered the workforce during the summer of 2007 as an apprentice tradesman just before the big crash and recession which followed. The impact of which strongly inspired his interest in the financial industry and began him as a student of the markets. Eric worked throughout the following years developing strong communication skills and risk management practices in the aviation and marketing industries before ultimately getting licensed and turning his passion into a career as a market strategist with RJO Futures.