The anticipation and release of Asia grind data has led the cocoa trade this week. Strong data continues to help cocoa move higher. Strong demand is needed in order to give the March contract support. North American data surprised – coming in 1.28 percent lower compared to the same period last year. Expectations were between 1-3 percent. This data release sent cocoa lower in Friday’s morning trade – touching 1916 in the March futures contract. Heading into the release – Thursday’s high touched 2011 in the March contract but pulled back as traders awaited the grinding data.

The futures appear overbought technically but traders have been waiting for the first data release of the year to guide their trades. The recent surge and post-Brexit vote highs in the Pound should move cocoa prices higher as well.

After the dust settles from the grinding data, look for a technical trade to take over. 2050-2115 is a realistic range for this time of year if supply and demand levels can even out.

Cocoa Mar ’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.