Cocoa Futures Look To Test 2600 by Next Month’s Contract Roll

Cocoa supported by the recent positive global sentiment
Cocoa prices should be able to test 2600 by next month’s contract roll
Traders should look at buying calls in the May contract if they are anticipating a move higher
Cocoa Futures Update

Cocoa Futures Update

Cocoa Futures - New Year, New Demand

March cocoa futures have rallied this past trading week as we leave 2019 and enter 2020. After the new year, the contract continued the move higher back towards 2550. The market has been supported by the recent positive global sentiment. Equities continue to make all-time highs which is carrying over to most commodities.


The Cocoa Factors Driving Prices

Cocoa is also finding a positive tone in the near-term demand of the soft. With the Euro and Pound moving higher, cocoa has followed. The Pound has climbed since the UK election. If demand can continue to grow out of Europe, even in the short-term, prices should be able to test 2600 by next month’s contract roll.

 

Looking Ahead In Trading Setups

Traders should look at buying calls in the May contract if they are anticipating a move higher in the new year.

 

Price Chart of Cocoa Market

Cocoa Futures Trading Chart
Source: Tradingview

If you are interested in discussing the soft commodities further contact pmooses@rjofutures.com . 

About the Author

Peter Mooses is a commodity broker at RJO Futures. He enjoys the analytical aspects of futures trading and appreciates the economic impact that commodities have across all markets.