Fundamental news in cocoa continues to be the story in the futures market. Grindings data is expected to show a rise in all regions. The European Cocoa Association report is released April 18 and the North American report on April 19. The market is being cautious as the trading range has tightened this week – you can see this in the July chart below. Expect volatility over the next few weeks. West African output is also going to add to this trend. Prices have moved higher, faster than most anticipated. Will the new data support the market or cause a break and correction back to 2200? Most likely the data will support the market and not be much of a mover but traders will lean on the side of caution. Watch support at 2475 – prices appear to like the level above 2500. Resistance has been set at 2670, bullish fundamentals and a break above this could set the market to 2750 over the next few weeks.
Cocoa Jul ’18 Daily Chart