Cocoa December Futures – 2300 Resistance Holds Strong
December cocoa futures are attempting to rally but technically 2300 continues to be a level of resistance. Today’s close, above the 9-day moving average, should trigger follow-through on this recent move higher.
With the US/China trade war constantly adding volatility to all markets, many commodities are seeing a different trade opportunity each session. A true move higher has been held in check since the markets aren’t able to show a consistent trade. With the European cocoa demand relatively weak, traders are turning to Asian demand as the main source or indicator for cocoa’s potential moves.
Currencies are also providing traders insight to the next moves in the softs. This week though, the Euro and Pound have consolidated – causing smaller moves in cocoa. Fundamentally weather patterns and disease are providing support in cocoa. Disease in Ghana’s crop could help prices hold at higher levels in the next trading year if production numbers come in weaker than expected.
Technically, look for 2360 to be the next target higher. After that level 2400 is next. If prices don’t hold or negative trade or global news breaks, cocoa can easily go back to trading at support levels between 2200-2240 in the December futures.
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